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NetSuite Aims At SAP with Manufacturing Edition

By Chris Kanaracus

June 12, 2008 — IDG News Service —

On-demand ERP (enterprise resource planning) vendor NetSuite is taking aim at a new vertical -- and, it says, ERP juggernaut SAP -- by releasing NetSuite for Manufacturers.

Despite its broad-based name, the new feature set is aimed initially at the light manufacturing industry. Companies in that sector have different needs from heavy manufacturing, as they deal less with raw materials and more often are assembling completed parts into products, NetSuite said.

To that end, the software includes additional work-order capabilities for managing the production schedule of general goods and special orders, as well as functionality for automating inventory replenishment. Users can set baseline stock levels and trigger points for re-stocking based on factors such as seasonal sales demand, according to NetSuite.

"Their wholesale and distro customers were asking for this. It seems like it was very much customer-driven, this one," said China Martens, an analyst with the 451 Group.

Those customers also often have a number of siloed systems for handling different aspects of their businesses, leading to integration challenges, said Mini Peiris, vice president of product marketing. "What we bring to the table is a vertical business suite."

NetSuite's announcement proclaims it is moving into SAP's turf with the announcement, referring to the "prolonged delay" of SAP's Business ByDesign on-demand product for the midmarket.

SAP, which declined comment, recently said it is scaling back its rollout plans for Business ByDesign, saying it needs to make sure it can derive enough profit from the offering.

NetSuite doesn't direct the same type of verbiage toward the industry's other ERP giant, Oracle. That company's CEO, Larry Ellison, holds a major stake in NetSuite.

Martens said NetSuite will face a varied field of competition with this latest offering, from vendors such as Epicor and Infor to Oracle's own JD Edwards line.

She questioned whether SAP should be on that list, however, as a midsize firm might consider its higher-end products while in the procurement stage, but then decide against it due to price. And it's not yet clear what manufacturing capabilities Business ByDesign will target, she added.

Overall, NetSuite is trying to bring as strong a play as possible to market by fleshing out its own light manufacturing features with a number of partnerships.

They include Omnify Software, which is integrating its product lifecycle management offering, and Configure One, which makes software for overseeing the manufacture of highly customized goods.

 

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