Market Overview

Bill Hill

Director of Marketing

Sage - Enterprise Solutions Division

Market Overview

ERP applications expected 11% CAGR 2002-2006• Integrated software to help manage in tough

economic times will return better than average growth

ERP applications with solid industry strategies succeed as the market matures

• ERP suppliers not in the leader board have to choose their industry sectors or find a different business model

(Source IDC) *(PMP Consultant)

Market Overview

While ERP solutions were designed to consolidate data management - ‘one version of the truth’. Businesses seem as badly ‘integrated’ as ever before

Many companies still take up to 9 days each month to close the accounts and report

Tough market conditions have refocused efforts on integration and getting more from their current systems

Reporting, stock optimisation,CRM The main challenge/opportunity for organisations ‘getting their

house in order’ is to make use of new technologies and standards - enabling integration beyond organisational boundaries

Collaboration

(Source IDC) *(PMP Consultant)

Market Overview

Linux fastest growing operating system on planet Massive hardware consolidation taking place as networks become

cheaper Is it .net or .not ? Integrated eBusiness related services that are industry specific shows

strong demand CRM is on the agenda of 39% of all mid market companies While the market for ERP solutions and services in the large enterprise

segment is maturing demand for ERP solutions and services in the small and medium enterprise (SME) market is expected to rise. There are signs that SMEs are finally adopting ERP systems

(Source IDC) *(PMP Consultant)

Market Overview

57% Mid Market Businesses expect to increase purchases via the internet next year

69% of all UK Medium Businesses purchase goods and services over the internet up from 46% in 2001– Most popular products

• Printers &Peripherals 60%• PC Networking Software 57%• Computing/electronic products 55%• Publications (Books) 50%

E Commerce 48%-75% will use secure on line transactions. B2b will become dominant 57% by 2006

By this time next year 8 out of 10 mid market companies will be focussed on improvements in electronically integrating both supply and customer transactions.

Source ( Supply Chain Management White Paper 2003)

Sage – Market Evolution

Automation Integration

Phase 1 Phase 2

Back Office

Invoicing

Purchasing

Credit

Reporting

ERP

Sales

HR

Stock

Production

Services

Sage – Market Evolution

Automation Integration

Phase 1 Phase 2 Phase 3

Connection

Govt eFiling Govt eProcurement Supply Chain Management

Accountants BanksPayroll 18m Forms Per annum

VAT 3.3m Forms Per annum

SA TAX 4.5m Forms Per annum

Accounts 825k Forms Per annum

So why can Sage succeed ?• 1.37 m UK registered companies• Sage has 500,000 UK customers• 60,000 new customers every year• Vertical Market Examples ……….Manufacturing

Construction

UK Universe 165,000139,000

% of UK Business 11% 9%

Accounts s/w Users 101,000 85,000

Sage Users 68,00038,000

Penetration 67% 45%……plus distribution, retail, services, accountants

Local Authority

Supply Side Integration

14,000 SMEs

2004 Deadline

389 LAs

800,000 SMEs

Buy Side Integration

Supplier Hub

160,000 SMEs

Electronic Trading Documents

Customer Supplier

Acknowledgement

Quotation

Delivery Note

Invoice

Order

Enquiry

Payment

CustomerRelationshipManagement

Web Site andWeb Shop

Sage FrontOffice Software

FinancialsCommercialsDistributionPayroll & HR

ManufacturingConstruction

ServiceRetail

Sage BackOffice Software

Your Customers

30%Are Sage Users

Your Suppliers

30%Are Sage Users

Your BankOnline Banking

GovernmentVAT

Inland RevenueCompanies House

Your AccountantFinal Accounts

TaxationAudit

Time & Fees

The Sage Connected WorldThe Sage Connected World

Thank You

Graham Cardwell