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Sage Online

We are long standing members of Sage Accountants Club and have recommended and sold their software for many years. Increasingly we find that clients are looking for an online solution and as a result we decided to actively look for client with whom we could trial Sage Online.

All was going well until we approached Sage to make our first purchase, their sales proposal is just unworkable....

Massive future price increases

The Accountants Club web site (as at 10th July 2012) clearly shows a price of £75 plus VAT per month against which we would receive a 20% discount. We sold to our client on this basis only to be told by Sage that they had increased the price by 56% but had forgotten to update the website. We look very silly now having told the client that it was £75 plus VAT yesterday but its £117 plus VAT today!

Ok, Sage agreed to honour he £75 plus VAT price but said it would increase to £117 plus any increase for 2013 in twelve months times, unsurprisingly our client has decided not to proceed. How can accountants confidently sign up clients to Sage Online if they know that they will be putting their clients at the mercy of Sage's pricing policy.... 56% in one year can never be fair or reasonable even with a major upgrade.

I feel sorry for accountants who have already signed up clients to Sage Online at £75 per month, they are now faced with breaking the bad news of the 56% price increase, a sure fire way to lose clients and destroy your business... not a good reason to join Sage Accountants Club is it?

Surely, the deal ought to be £75 plus VAT per month with a guarantee of no increase for say three years, that way we can sell the product with confidence.

The direct debit catch

The proposal on sage's website if £75 per month (well it should be £117 per month) but this is also not quite what it seems. What actually happens is...

Your practice buys the software from Sage (clients can't buy direct) which is invoiced at £1400 plus VAT, less the 20% club discount = £1,344. The client then pays Sage £116 plus VAT per month by direct debit which is credited to your account, if they pay 12 installments you end up 20% in credit. Sounds good but the catch is that if the client cancels or stops paying the direct debit then you become liable to Sage for the remaining balance!!

Join Sage Accountants Club and end up personally guaranteeing your client's debts! Surely, Sage ought to collect the fee direct from the client and rebate 20% to the Accountant partner as a credit to their account? The accountant can then decide to either rebate the discount to the client or use to it to subsidise the cost of club membership.

I really hope that I have misunderstood what Sage have told me but we spoke to two different sales advisers and each confirmed the same thing. We really want to sell Sage Online to our clients, we think that Sage is a fantastic product but the reasons above prevent us from promoting this particular product.

Has anyone had experience of selling the Sage Online software and could anyone recommend an alternative with a fairly pricing policy?

Replies

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By occca
10th Jul 2012 13:47

Why would you pay £117 per month !!!

When you can get Xero and other packages for a fraction of that price?

Sage are losing the plot and we have more and more clients moving away from them 

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By JC
10th Jul 2012 14:33

Outrageous prices ..

@occca - quite right

What are these comedians Sage playing at - still guess everyone is used to their antics by now

Just try loooking up 'Sage Live Security' in Google - Sage first online effort that they have tried to bury and re-badged their 'Sage Live' product to get away from the initial stigma

Just a refresher

http://www.zdnet.com/blog/saas/sage-shows-why-bigcos-cant-be-trusted-with-saas/655

http://www.kashflow.com/blog/sage-live-security/

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By dreamcatcher
10th Jul 2012 16:45

Sage really are on a different planet

Nothing surprises me with Sage.  Their products are utter shite yet they seem to believe they can charge stupid prices.

The practice I work for is actively trying to move clients away from Sage on to other packages, whether that be desktop or cloud packages.  

We are currently testing Iris open books which looks very good.  Other cloud packages to look at would be Xero and Kashflow.  I have used both and they are equally excellent.  Both are under £20 per month with no contract and the client pays directly so no risk of you picking up the debt. 

 

 

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11th Jul 2012 06:40

@dreamcatcher

dreamcatcher wrote:

Nothing surprises me with Sage.  Their products are utter shite yet they seem to believe they can charge stupid prices.

I totally agree... their products really are SO poor compared to software like Xero... and their payroll is just laughable, it really is, compared to say Moneysoft, which is FAR superior.

How people pay their completely outrageous prices for such poor software is totally beyond me...

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Moving from Sage

Wow, I have always been Sage averse (preferring QuickBooks for clients before Xero came along) but I am surprised at the above tale of woe. They must be hemorrhaging small business customers to newer rivals.

Certainly our data conversion business seems to suggest that.

Adrian
Movemybooks

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10th Jul 2012 21:07

Reply from Sage

 

We’re sorry for the confusion with the out of date pricing on the web page, we’ve now corrected it.

Sage 50 Accounts Hosted has recently undergone a revamp.  We’ve updated the version to Sage 50 Accounts Professional 2012 and upgraded the infrastructure behind the scenes for an overall better service.  As part of this revamp and investment we’ve changed the pricing, which has been the same since 2006, so it’s now similar to the cost of ownership a customer would expect for Sage 50 Accounts Professional with SageCover Extra.  

The service is aimed at established and growing businesses that need the flexibility and freedom of hosted software with the powerful and broad range of features in Sage 50 Accounts.  It also includes full access to technical support and the software will always be up to date.

If our customers don’t need this much functionality then the Sage One range of products may be more appropriate and pricing starts from only £5 a month.  In particular Sage One is great for Accountants collaborating with their Clients.

We'll also take a closer look at the charging model for Accountants with Clients using Sage 50 Accounts Hosted to see whether we can make it easier and more appealing for you.

 

Mark Duncan

Product Manager for Sage 50 Accounts Hosted 

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By logika
11th Jul 2012 09:55

Interesting replies, but as I said we really like Sage software but just feel aggrieved by the current situation. I am staggerred by Sage's comment that the pricing now mirrors the cost of buying the stand alone version.... No it doesn't!!!

The standalone is a one-off purchase, hosted is a monthly commitment so is much more expensive long term.

If Sage are serious about this market they need to act quickly, my suggestion would be..

- £70 per month payable by client to Sage.
- Fixed pricing for 3 years.
- montly credit to accountants account of £14 per month.

Simple... If they do that then I am sure they will see online grow.

We use Iris for all practice software but when we looked at open books (a year or so back) it seemed a bit basic and not really suited to our clients.... Has it improved?

Mark

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11th Jul 2012 08:07

I agree with others

In my opinion, Sage is over-hyped, overpriced, and there are much better products available.

'Sage Support' does not seem to include customer satisfaction, or at least not in my case and I got rid of all my Sage products about 3 years ago when I felt I was being treated as a cash cow, and was deceived over pricing agreements (ie. being told Sage was cheaper than my current software, and not being told I was being given a hefty discount that would disappear and that in reality Sage was actually MORE expensive PLUS I suffered the cost of changing data over and retraining of staff).

I learned the hard way. I am far less trusting of software vendors now.

 

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By mm01
11th Jul 2012 08:10

Bin Sage

Ive switched all but one of my clients to better and cheaper software and I can say its been one of the best things Ive ever done!  I even gave the time to update the new system away free as I new the jobs would become more profitable and I saw at least a 25% increase on everyone.

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I imagine the prices are a function of the user base, Sage's pricing model seems to be, take all overheads and fat profit margin, divide by user base = price. After all they are the market leaders and only a fool would take other products....which reminds me I have a meeting today on my last remaining SAGE client.

I am hoping by the end of it I will have zero sage clients. Or do I mean Xero?

@Mark Duncan, I would get looking for a job if I was you, your employer will be doing bust within 5 years.

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11th Jul 2012 11:10

Such arrogance

Love the way Sage refer to a 56% hike in prices as "changing the pricing".

 

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By 0098087
11th Jul 2012 11:29

Wouldn't go near Sage with a barge pole

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12th Jul 2012 17:23

Xero Pricing

Just to clarify the point made above about Xero pricing and billing options for clients.

Our client software is indeed available for clients to subscribe to directly themselves at either £12, £19 or £24 per month, and then they can invite you in as a user to help them - Xero has unlimited users included in the monthly subscription.

However by becoming a Xero Partner, accountants and bookkeepers unlock not only a discount off the published prices but two other subscription plans (not listed on the website) that are only available to Xero Partners at £2 per month per client for Xero Ledger Edition for very basic compliance clients, and £9 per month per client for Xero Partner Edition for regular cashbook level clients.

Xero Partners also get preferential pricing on our cloud based Practice Management application and will also get our accounts production functionality when it rolls into the UK next year, for free.

There's no minimum contract regardless of whether the client subscribes directly or through an accountant or bookkeeper. Stop using it, stop paying instantly.

Gary Turner
Managing Director, Xero
@garyturner

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12th Jul 2012 18:59

@garyturner

garyturner wrote:

Xero Partners also get preferential pricing on our cloud based Practice Management application and will also get our accounts production functionality when it rolls into the UK next year, for free.

... sounds very exciting, here you have a VERY satisfied Xero customer Gary - cannot recommend it highly enough!

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12th Jul 2012 17:04

anything but sage!

Sage has to be the worst software and most arrogant company I have ever come across! Yet it has a massive customer base !!!!

 

Personally i wouldn't touch it with a bargepole - but they must be doing something right???????

 

You are better off looking at Xero, Kashflow/Orbit Accounts or Freeagent/Openbooks. ..... and have a look at movemybooks - an online service that helps you convert from Sage to Xero. Stop being fleeced - vote with your feet!

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12th Jul 2012 19:16

@BigBadWolf

BigBadWolf wrote:

Personally i wouldn't touch it with a bargepole - but they must be doing something right???????

I think when people start up in business they THINK they should use Sage... how many times have I heard a client say, 'we've made a start, we've bought Sage'...

Then once they realise what an overpriced, clunky, useless piece of software it is I put them on Xero!

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By dreamcatcher
13th Jul 2012 10:38

The problem is

 

I think when people start up in business they THINK they should use Sage... how many times have I heard a client say, 'we've made a start, we've bought Sage'...

Then once they realise what an overpriced, clunky, useless piece of software it is I put them on Xero!

 

The problem is that Sage is readily available on the shelf in places like PC World and Staples.  It also doesn't help that organisations like Business Link push packages like Sage (and Quickbooks) as being premier products that will help clients better manage their recording keeping.

Hopefully if the postings here are representative of the wider accounting profession then Sage will have a much reduced client base in the future, which it very much deserves.

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19th Jul 2012 09:41

Online Sage

With reference to the original post and to highlight a few differences:

Online50 is not Sage and our prices remain unchanged (since 2008).

Our product is offered on monthly terms - there is no minimum term other than one calendar month.

We offer all versions of Sage from Line 50 v 8 to the present and all feature sets - Accounts, Accounts Plus and Professional 

We offer accountants Linked Client billing where we invoice the client directly and forward the credit note for 25% margin to our partner accountant.  The client's data will be available in the accountant's bureau software.  Accountants can have unlimited datasets and they can be in any version we offer.

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Accountants using Sage 50 for their clients

There is also another option that Accountants could consider when using Sage 50 with their clients.

PaperLess offers the clients of Accounting practices the ability to use PaperLess via the Internet as follows:

Upload documents to PaperLess (most file formats including scanned paperwork)Prepare the accounting transaction (or the Accountant can offer to do this) - automatic invoice recognition can also be used to reduce manual data entry when PaperLess reads the document image and automatically prepares the transaction.Post the transaction into the Accountants Sage 50 Accounts (or the Accountant can offer to do this)Search and view the transactions from Sage 50  with the document imagesUse Document Flow to manage an approval process prior to processing a transactionArchive all other non-accounting documentation is a separate document archive

The recurring costs are closer to the "pure cloud accounting applications" that are mentioned which are much lower than the prices quoted for Sage 50 Accounts Hosted.

PaperLess also integrates with other accounting applications but this additional option may be useful to Accountants who want to ensure that there clients are able to keep accurate records and share them easily with their advisors.

Phil Richards

-- Accounting the PaperLess way™

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