How Much Does Construction Software Cost?

Generally, here’s how it goes when a person needs a tool to do their job: There is a clear need for a tool, the tool has a set price, and the decision to invest or not invest is relatively straightforward.

This is simply not the case with software. Why is that?

Oftentimes, a company looks for a price for software without understanding the full spectrum of benefits and the true value the software has to its owner(s), managers, office personnel and field staff.

The main reason most salespeople struggle with providing a price is because they are not good at determining the value to a contractor. This article explores that value and how it relates to construction software cost.

First, Evaluate the Cost-Benefit of Construction Software

Here are just a few of the questions companies should be thinking about when doing a cost-benefit analysis of construction software.

• How much is it worth to cut the time of a critical process in half? Or, catch a change order that may have been missed? Or not be able to make quick and accurate decisions while projects are in crucial stages?
   
• Is duplicate data entry part of your process?
   
• How is the work involved in using Excel for reporting or tracking important information more valuable than having automated information that is integrated, fast & accurate?
   
• What about all the time it takes to put together the right reports, contracts & forms? Everyone’s time is worth something.

How Software Pricing Is Determined 

Once your company’s software needs are determined and the value has been recognized, the pricing piece is simple.

First, how many concurrent users do you need and which modules are required? Once determined, most software vendors can give you the monthly or annual fee for the use of the software including updates and support.  Next, if the vendor has the amount of experience necessary to successfully help your company implement a new system, they sure better have an idea of the range of services you need, this is surprisingly simple to determine.   Asking the right questions about your needs, complexity, experience and knowledge will be enough for a good financial expectation to get your system up and running.

Generally, most all software systems are priced this way and salespeople can come up with a price fairly easily.

How to Estimate Implementation Cost

The slightly more difficult task is coming up with an accurate software implementation cost to get the system up and running.

Most companies will need to budget for electronic data conversion of vendors, customers, employees. Electronic data conversions are easy to price, because it doesn’t matter if you have 50 or 500 vendors – the time required is essentially the same.

The software training budget is by far the hardest to pin point. This will depend on a few key variables. Mainly, the level of knowledge & experience the main users have along with the complexity of the business requirements.

Obviously, implementing certain integrated modules like estimating, service management, field operations or going paperless requires more time. An implementation budget can be accurately estimated after a complete needs assessment has been done.

As a general rule, 90% of our customers investing $3,000-$6,000 in implementation services to get completely up and running.

In our years helping contractors migrate to a Sage software system, most spend between $2,500 to $7,500 a year on software fees (depending on the modules needed, this pricing includes the annual updates/support and consulting).

Outgrown QuickBooks?

If you are outgrowing your solution, struggling to get enough out of something off the shelf and generic like Quickbooks, or you have an older legacy system that has run its course, have someone help assess your needs to determine if a construction or service management solution provides enough value to your company.

From there, it will be easy to formulate a ROI and the value construction software will bring to staff, management, owners and field personnel.

At Software Consultants, we’ll go above and beyond to get you better acquainted with Sage 100 Contractor, the most innovative construction management software on the market. Contact us today to go over pricing plans as well as learn more about our software implementation process.