1. SAP R/3 Budget

2. SAP R/3 Costs  Hardware  Software  Add-on software and hardware  Implementation process  Training of operators  Maintaining the system  Opportunity costs of system failure  System upgrade

3. Cost of Hardware  Basic workstation  Dell Dimension 2400 Series: $618 per unit (Bulk sales negotiated)  Quality and Development Server  Dell PowerEdge 1600SC: $6,862 per unit  Production Server  PowerEdge1600SC: $10,799 per unit

4. Cost of SAP R/3 Software  SAP cost fluctuates; approx. $1.5 million. Cost includes client-side and server-side software, backup software, operating system, test and development tools.  Modules can be customized; selected modules are pertinent to business functions

5. SAP Modules NECESSARY  Financial Accounting  Human Resources- Personnel Admin.  Materials Management  Sales and Distribution FOR IN-HOUSE PRODUCTION  Production Planning  Quality Management  General Logistics  Plant Management

6. Cost of Add-On Software and Hardware SOFTWARE  Backup executive file for Windows servers  Veritas ver. 9.0: $300-500  Backup Storage Area Network Option  BrightStor ARCserve ver. 9: $1000- 1600 HARDWARE  Storage controller  Adaptec SCSI RAID 2100s: $388-445 each  Interface Converter  IBM SAN Data Gateway Router 2108 Model R03: $6000  Networking Cable  Belkin Pro Series: $40 per 100 ft.  Router  D-Link DI-604: $60  Barcode Scanner  Wasp WLP 4170: $250-300.

7. Cost of Implementation

8. Cost of Training of Operators

9. Cost of Maintaining the System ANNUAL COST  Cost determined by but not restricted to the follow factors: Customer Support Replacement materials Debugging and anti-virus software  Maintenance costs included on budget also comprise of wages for support personnel (cost obtained by number of employees times average yearly salary)  20 employees @ $75,000 annually= $1,500,000

10. Lost Opportunity Costs  Gauging cost is difficult and sometimes inaccurate.  Solution: set money aside (amount still to be negotiated with size of R/3 system) for possible system failure  Scenarios to consider: General Ledger application crashes Infrastructure collapses Productivity services become unavailble

11. Periodical System Upgrade  The typical upgrade for SAP would be approx. $3.1 million.  This number can decrease, however, with the number of modules on the company’s system.  The ImageFX Upgrade cost, based upon the number of end users and modules, should approximate to about $600,000.

12. Final Budget Cost of Hardware$23,841 Cost of SAP Software≈ $1,500,000 Cost of Add-Ons≈ $12,452 Cost of Implementation≈ $119,060 Cost of Training $145,000 Cost of Maintenance≈ $1,600,000 Lost Opportunity CostsTBA Cost of Upgrade≈ $600,000 GRAND TOTAL$4,000,353