The 4 Ways ERP Projects Are Billed

ERP billing can feel like trying to read the fine print on a phone contract—confusing, with hidden surprises that show up at the worst times. But it doesn’t have to be that way! Let’s break down the four main ways ERP projects are billed, so you can figure out which method works best for your business (and your sanity).

Fixed-fee projects: The "it sounds safe" option

Fixed fee billing feels like that all-inclusive vacation package—you know the cost upfront, and it’s supposed to cover everything. This can be great, especially if you like certainty. The catch? Just like finding out your “ocean view” is actually a view of the parking lot near the ocean, the reality of fixed-fee projects can sometimes be less than dreamy.

Benefits

• Predictable costs: No surprise fees. You get a number, and that’s what you pay. Simple, right?
• Clear expectations: Scope, timeline, and deliverables are all spelled out from the start.

Risks

• Change = pain: You’ll need to crack open the wallet every time you want something outside of the original plan. Not fun.
• Quality sacrifices: Sometimes the service provider might cut corners to stay on budget and on time. You could end up with a service that’s more “just okay” than amazing.

Time and materials projects: The "let's play it by ear" approach

This is where flexibility rules. You pay for the actual time and resources spent, and the service provider adjusts as your needs evolve. Think of it as ordering à la carte instead of the full meal.

Benefits

• Flexibility – Need to add or change things mid-project? No problem.
• Transparency – You know exactly where your money’s going, with a nice, clear breakdown of hours and costs.

Risks

• Budget black hole – Costs can spiral if the project drags on, like that home renovation that never seems to finish.
• Timeline troubles – Without clear deadlines, things can slip, leaving you paying for extra hours with no end in sight.

Cost-plus projects: The "middle ground" method

This billing approach is like paying your tab at the end of a dinner party—you cover the actual costs (materials, labor, etc.) plus a pre-agreed fee for the service provider’s profit. It’s good for projects where things are likely to change, but you still want some control over costs.

Benefits

• Flexibility – Like time and materials projects, you can make adjustments as you go.
• Shared risk – Both you and the service provider have skin in the game, which can encourage smarter spending.

Risks

• Cost control issues – There’s still the risk of overspending. You’ve got to keep a close eye on the tab to make sure you don’t get sticker shock at the end.
• Trust problems – If the service provider isn’t transparent about costs, things can get messy.

Subscription-based projects: The "ERP, but make it like Netflix" idea

This is the new kid on the block. Subscription billing works just like your favorite streaming service: pay a recurring fee, and you get continuous access to ERP support, upgrades, and services. It’s a great option if you prefer long-term relationships over short-term engagements (and who doesn’t like a little stability?).

Benefits

• Consistent costs – Budgeting becomes a breeze with predictable monthly or annual fees.
• Ongoing improvements – You’re always getting the latest and greatest features without worrying about big upgrade costs.

Risks

• Commitment issues – Some companies might hesitate to sign up for the long haul without first knowing if it’s the right fit.
• Defined deliverables – Both sides need to be clear on expectations, or it can get awkward fast.

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No matter which billing approach you choose, the key is to match it with your business needs and project goals.

And remember, with Stellar One, you don’t have to sweat the small stuff—we’ve got you covered with unlimited support, predictable costs, and no surprise fees!