Despite the innovation boom in cloud software, a multi-function app was better than connecting multiple applications for running the financial side of a business, said Zach Nelson, NetSuite CEO, at a press lunch in Sydney yesterday.
“The cloud has made it easier to integrate but it’s no easier to sync,” Nelson said. “The underlying problem is that data needs to match in two systems. But the cloud doesn’t solve data synchronisation,” he said.
NetSuite has developed into an enterprise resource planning program spanning general ledger, point of sale, inventory, e-commerce interface, customer relationship management (CRM) and quoting system. It has taken market share from large server-based systems built by SAP and Oracle.
In the small business market, however, a more fragmented approach to software has emerged. Cloud accounting program Xero has grown swiftly to over 200,000 business customers, many of whom buy “add-on” programs for features such as inventory, quoting, invoice and receipt processing and CRM. Xero had over 200 add-on programs listed on its application directory.
Businesses using multiple applications underestimated the cost of managing the “hairball” of programs, Nelson said.
“I’ll give you a simple example. If you’re using Salesforce.com for a CRM with NetSuite. They will have different numbers for a customer. So which one is the customer number?”
Salesforce.com’s platform approach was not successful for building financial apps, Nelson said.
“Salesforce.com have no ERP. Financial Force (built on the Force.com platform) has zero traction. You can’t build complex apps on top of an abstract layer,” Nelson said.
Dedicated e-commerce software such as eBay’s Magento could only provide an attractive display but couldn’t handle the billing behind the scenes, Nelson said.
NetSuite recently released a tool for building web stores for mobile devices and desktops called SuiteCommerce Advanced which competed with Magento. “It’s faster than Magento and a fantastic front-end for NetSuite,” Rob Hooton, an e-commerce specialist with NetSuite.
NetSuite also defended its pricing for small businesses. “I think we have pretty decent pricing for the lower end of the market,” Nelson said. “If you talk to customers (who complain about pricing) they would understand that if they left they would pay much more integrating all the other apps,” he added.
“I think it’s a well priced product for what you’re getting,” said Shaun Bajada, director of internal operations at the Australian Retailers Association, who also attended the lunch. “As a retailer in Australia you have to have that seamless experience online and in the store,” Bajada said.