We’re now starting to collect enough evidence to suggest that when Salesforce is competing against SuiteCRM, they embark on a three phase strategy.

They know that SuiteCRM is a serious competitor. They have lost several large-scale enterprise-class, global projects to SuiteCRM in the last 12 months. One of these in particular, would have been north of $30m in value.

As a CRM buyer, you can use this to negotiate substantial discounts from Salesforce. You need to get through each phase to get to the pot of gold at the end of the rainbow. We’ve made a short list of suggested responses for each phase.

Your starting point should be to tell Salesforce you have a short list of them and SuiteCRM. You can expect a variation of the following:

Phase 1 – Uncertainty

Salesforce response

What you need to know

Salesforce may suggest that SuiteCRM is designed for small companies but is not suitable for more than 20 users.

One of India’s largest telecoms companies is using it for their customer support centre with 1,000 agents and 20 million customer records. SuiteCRM is used by governments, government agencies, large multi-nationals and by a host of more moderately sized companies. It scales from single figures to user populations of thousands.

Salesforce may suggest that open source is low in quality.

Most industry watchers acknowledge that because the code in an open source project is publicly available and thousands of developers can read, amend and fix bugs, that open source is frequently of a higher quality than proprietary software where far fewer people know where the bugs are.

Salesforce may suggest that SuiteCRM is developed part-time by people working from their bedrooms.

SuiteCRM has a full-time development team working on enhancements and fixing bugs. Additionally, SuiteCRM’s clients include some of the world’s largest corporations, many of whom actively donate code to the project.

Salesforce may suggest that SuiteCRM only contains basic functionality

SuiteCRM is an enterprise-ready application that delivers the same core modules as Salesforce Enterprise. SuiteCRM also contains additional functionality such as Events and customer Portal as standard modules. Either Salesforce does not deliver this or it is at an additional cost.

Salesforce may suggest that SuiteCRM requires additional architecture and developers for maintenance and support and that you will need full-time developers and administrators that will add huge additional costs.

SuiteCRM has an OnDemand service similar to Salesforce. SuiteCRM:OnDemand includes support, maintenance and ongoing upgrades as part of the standard service. There are no additional costs and there is no need for developers or administrators.

 Phase 2 – Arrogance

Salesforce response

What you need to know

Salesforce may point to the Gartner Magic Quadrant for Customer Engagement and Salesforce Automation where they are the market leader.

You need to understand Gartner as a company before you can understand the Magic Quadrant. Gartner’s business model is as a consulting company. They employ very smart people to do the analysis for the Magic Quadrant. Very smart people cost lots of money. However, a long-standing criticism of Gartner is about the lack of disclosure of the money received from the vendors it rates, raising conflict of interest issues. Put simply, it may cost Salesforce a lot of money to be the leader in the Magic Quadrant. We are not suggesting that Gartner are unethical. We merely observe that the lack of transparency raises substantial questions.

Salesforce may suggest that they dominate the CRM marketplace because they have the best software and service.

CRM software is, in general, commoditised business logic. Most of the major CRM applications, including SuiteCRM, deliver the same general functionality. We may do some things better, we may do some things not so well but over the course, SuiteCRM delivers enterprise CRM functionality in a free and open source package.

Salesforce may suggest SuiteCRM is supported by a small company and that there are inherent risks in engaging with small companies.

Salesforce is a loss making business sustained through the goodwill of its investors. Salesforce’s CEO, Marc Benioff’s remuneration package in 2015 was $63.7m. Salesforce uses sophisticated accounting methods to obscure its real performance. Many analysts are deeply critical of these and there is great uncertainty about the sustainability of their business model. The risk may be greater engaging with Salesforce than engaging with SuiteCRM, where the company that writes and supports SuiteCRM is profitable, growing, follows standard accounting conventions and executive remuneration is aligned with general staff earnings.

 Phase 3 – Cost

Salesforce response

What you need to know

Salesforce may suggest that there are many hidden costs with SuiteCRM.

One of the constant criticisms of Salesforce is that they penalise success. They have countless charges for additional services that users will need as they expand their use of CRM. What starts as an already expensive application can rapidly become a very expensive one.

SuiteCRM on the other hand is a moderately priced application with room for users to expand without incurring large additional costs. There are no hidden charges.

Salesforce may suggest that an on-premise deployment of SuiteCRM requires a significant investment in hardware, consultants, developers, maintenance staff and upgrades.

Practically, most users of SuiteCRM will deploy the application to low cost commodity servers from vendors like Amazon or Microsoft. These do not require investment in hardware and can be resized rapidly to account for periodic loads.

Most users of SuiteCRM on-premise will engage with SuiteCRM for support and for ongoing software development and maintenance.

Software development costs from the SuiteCRM project are substantially lower than those from Salesforce. If there are software development needs with SuiteCRM, there are likely to be software development needs with Salesforce. The difference is that SuiteCRM costs are lower and implementation timescales significantly shorter.

The costs of deploying SuiteCRM on-premise and engaging with the project for support and development will always be radically less expensive than a Salesforce in-the-cloud solution.

The difference too is that with SuiteCRM, you have the choice. With Salesforce you don’t.

 The End Game

Salesforce will have run out of steam. They have thrown their best shots at it and not prevailed. They have one more weapon in their armoury. But it’s not very good. It’s cost. If Salesforce wants your business, they will discount aggressively. And we mean aggressively. Expect discounts of more than 60%.

That’s great news. You now know that the Salesforce proposition just isn’t going to get any better. You’ve done a great job and potentially saved your company hundreds of thousands of pounds.

But wait. Even with those discounts, Salesforce is still greatly more expensive than SuiteCRM. Consider this project profile (note: for the sake of clarity we have assumed that the effort for both Salesforce and SuiteCRM is the same. In reality, given identical requirements, Salesforce’s projects tend to be considerably larger in terms of manpower and effort. They take longer and cost more to deliver the same thing):

Item Year 1

Salesforce with 50% discount

SuiteCRM

100 users

£45,000

£0

10 days of Consulting

£6,000

£8,000

20 Development

£12,000

£14,000

5 days of training

£3,000

£4,000

Support

Included

£2,000

TOTAL

£66,000

£28,000

So, even with 50% discounts, Salesforce is more than double the cost of SuiteCRM. But the pain doesn’t stop there. What about year 2?

Item Year 1

Salesforce with 50% discount

SuiteCRM

100 users

£45,000

£0

5 days of Consulting

£3,000

£4,000

5 Development

£3,000

£3,500

1 days of training

£600

£800

Support

Included

£2,000

TOTAL

£51,600

£10,300

 Now that you’ve squeezed every last drop out of Salesforce and appreciated that even with huge discounts, it’s still a massively overpriced application and that the emperor has no clothes, there’s the final decision – whose service are you going to use?

 We’ll leave that to you.