1. Market Overview Bill Hill Director of Marketing Sage - Enterprise Solutions Division

2. 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)

3. 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)

4. 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)

5. 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

6. 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)

7. Sage – Market Evolution Automation Integration Phase 1Phase 2 Back Office Invoicing Purchasing Credit Reporting ERP Sales HR Stock Production Services

8. Sage – Market Evolution Automation Integration Phase 1Phase 2 Phase 3 Connection Govt eFilingGovt eProcurementSupply Chain Management AccountantsBanks Payroll18m Forms Per annum VAT 3.3m Forms Per annum SA TAX4.5m Forms Per annum Accounts825k Forms Per annum

9. 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 ………. ManufacturingConstruction UK Universe165,000139,000 % of UK Business11%9% Accounts s/w Users101,00085,000 Sage Users68,00038,000 Penetration67%45% ……plus distribution, retail, services, accountants

10. Local Authority Supply Side Integration 14,000 SMEs 2004 Deadline 389 LAs 800,000 SMEs

11. Buy Side Integration Supplier Hub 160,000 SMEs

12. Electronic Trading Documents Customer Supplier Acknowledgement Quotation Delivery Note Invoice OrderEnquiry Payment

14. Customer Relationship Management Web Site and Web Shop Sage Front Office Software Financials Commercials Distribution Payroll & HR Manufacturing Construction Service Retail Sage Back Office Software Your Customers 30% Are Sage Users Your Suppliers 30% Are Sage Users Your Bank Online Banking Government VAT Inland Revenue Companies House Your Accountant Final Accounts Taxation Audit Time & Fees The Sage Connected World

15. Thank You Graham Cardwell