Sage 500 Overview
Status: Actively Maintained & Sold
Sage 500 c (formerly MAS 500) is one of the most popular ERP products from Sage for distributors and manufacturers. Designed for larger companies, Sage 500 scales well for operations with several hundred users. Available in North America, it was one of the first products developed in Microsoft’s Visual Basic and SQL Server environments and enjoys a strong and loyal following to this day.
Sage 500 History
State of the Art Software (SOTA) developed MAS 90 in the early 1980s as one of the first accounting systems available for personal computers. By the early 1990s, the underlying technology in SOTA’s flagship product was starting to show its age. SOTA, realizing the growing importance of Microsoft’s Windows platform and new Microsoft SQL and Visual Basic technologies embarked on a major rewrite and redesign of MAS 90 which was originally intended to be a replacement for the aging product.
However, MAS 90 sales never dropped off so State of the Art instead decided to continue developing the new product as a high-end solution for larger MAS 90 customers and prospects. Instead of a replacement product, this new solution was branded as Acuity Financials and was launched in 1996 with four main modules – General Ledger, Accounts Receivable, Accounts Payable, and Cash Management. Additional modules were added for Purchase Order and Multicurrency. Meanwhile, State of the Art continued developing MAS 90 eventually rewriting much of the product in a new Business Application Framework completed in the early 2000s.
Acuity Financials was one of the first business applications of its kind built from the ground up on Microsoft SQL Server technology in Visual Basic 6.0. This cutting-edge technology and scalability soon attracted third party software developers as an integration platform. An early adopter of the platform was Proamics which was later acquired by Niku. Proamics and Niku provided professional services automation (PSA) software with robust project accounting applications. State of the Art heavily promoted Proamics/Niku and was soon winning business in the PSA market which was dominated by Solomon Software who was struggling at the time with their own rewrite to newer Microsoft technologies. The Proamics/Niku relationship with State of the Art faded as a new alliance was formed with Intellisol International, a North Dakota firm which selected Acuity as a platform to develop a new version of its own PSA software. Unlike Proamics/Niku, the Intellisol product was written from the ground-up in the Acuity Visual Tools as a native Acuity business application. Sage acquired the Intellisol product in October 2001 making it available as the Project Accounting module as it exists today. The original Intellisol eTimeSheets module has since been replaced by Sage Timesheets which Sage sold to Insperity in 2012. Intellisol, having another product tied to Microsoft Dynamics GP (Great Plains) was acquired by Microsoft in 2012 and folded into Microsoft’s ERP business unit.
Acuity became a viable solution for wholesale distributors in 1999 with version 4.0 which introduced three new modules – Sales Order, Inventory Management, and Inventory Replenishment. The inventory applications were designed by distribution expert Jon Schreibfeder and developed in part off-shore. Sage brought the development back inside its organization. Schreibfeder and Sage wrote a book outlining how to use Acuity in a distribution environment.
The original Effective Inventory Management book for Sage 500 is no longer available from Sage but copies of it are still floating around in hard copy from resellers and early users of the software. Schreibfeder has since updated his methodologies which are available in the latest edition of his book, Achieving Effective Inventory Management. While not specific to Sage 500, this is an incredible resource for any Sage 500 user – especially those in wholesale distribution. Schreibfeder is available for personal consulting engagements for Sage 500 customers through his company, Effective Inventory Management.
With the introduction of Inventory, a number of third party developers were soon attracted to Sage and Acuity Financials. Among these were Radio Beacon, a warehouse management system (WMS) software developer in Canada that is now part of Accellos. Another was EDI-provider eBridge which had a lock on EDI with Sage 500 for many years until it was unseated by TrueCommerce (now part of HighJump Software). Radio Beacon’s integration is still available for Sage 500 through Accellos but there are several other WMS solutions available on the market including Scanco (previous private-labeled WMS solution available through Sage for Sage 500), DCWarehouse by DCSC Corporation, and O2 Mobile Warehouse by Escape Velocity Systems. The Scanco and DCWarehouse solutions are both developed in the Sage 500 Application Framework.
Sage 500 was progressing toward ERP rapidly. Consider that the application was launched in 1996 with distribution capabilities added in the 4.0 release in 1999. As the Acuity team was busy writing distribution, two other companies were writing manufacturing applications. One of these companies was trying to integrate an existing product (not in the toolset) to Acuity’s accounting modules while the other was developing applications in the Acuity toolset on top of the entire Acuity suite – accounting and distribution. Below is an overview of what happened next and how this led to Acuity Financials becoming a true ERP application.
It wasn’t until 1999 that Acuity Financials (Sage 500) became a true ERP business application. ERP is an extension of manufacturing resource planning (MRP II) and material requirements planning (MRP) which originated in the 1960 and 1970s through the efforts of Ollie Wight and early ERP pioneers. The term ERP was first used by industry analyst firm Gartner Group in 1990. ERP software provides integration between all aspects of a company’s business – accounting, distribution, manufacturing, human resources, customer relationship management, and more. One of the fundamental differences between MRP II and ERP is the use of relational databases and fourth generation programming languages. ERP software originally defined manufacturing software but is now generally used to define the main business management system used in many different industries even if there is no need for manufacturing and production planning.
A niche ERP provider in the 1990s was Monitor Systems, a software publisher located in Michigan focused almost exclusively on the automotive supply chain. The company announced that it would develop and deliver an integration to Acuity Financials (accounting integration only) but failed to do so and was later acquired by Computer Decisions International (CDI). CDI canned the integration project and later focused on rebuilding its legacy Microshop ERP software on the SAP BusinessOne platform. CDI was acquired by Quantum Ventures of Michigan in 2011 and is now operating as Quantum Software. The Microshop product was renamed as Shop Blocks and is still sold today through the SAP BusinessOne community. Quantum Software also owns legacy ERP vendor InMassMRP. The Monitor ERP solution is no longer available.
Monitor’s failure to deliver a manufacturing solution for Acuity Financials opened the door for other developers – especially after the 4.0 release of Acuity Applications which introduced distribution functionality. This paved the way for a new wave of third party developers providing vertical solutions and add-on products developed specifically for manufacturing companies. Acuity was on the brink of becoming a true ERP business application.
Headquartered in northeast Ohio, Haitek Solutions was an independent ERP software developer. Haitek’s legacy product, Shop-IV, was developed in Thoroughbred business basic and integrated with Thoroughbred’s Solution-IV accounting software. Bill Henslee, founder of Haitek Solutions saw the market moving away from Unix-based applications and proprietary databases to Microsoft Windows and Microsoft SQL Server in the mid-1990s and quickly sought out a new platform for the next generation of Haitek’s manufacturing ERP products.
Haitek became a development partner for Acuity Financials in 1996 and rewrote Shop-IV from within the Acuity Visual Tool software development kit. The new product was called Envision ERP which extended Acuity with new features for manufacturing work orders, job costing, MRP, advanced planning and scheduling (APS), estimating, and product configuration.
Envision ERP was officially introduced in 1999 and was wholly-acquired by Sage in March of 2001. The product lives on today as the eight manufacturing modules available for Sage 500 ERP – Light Manufacturing (aka Advanced Kitting), Advanced Manufacturing, Material Requirements Planning, Advanced Planning & Scheduling, Product Configurator, Estimating, Engineering Change Management, and Shop Floor Control.
The original Haitek Solutions development, consulting, and support staff are now back together at e2b teknologies along with other veteran Sage Software employees. Today e2b is the leading provider of Sage 500 consulting, development, and third party products for Sage 500 with a staff that includes 40 employees. e2b has developed more than a dozen product enhancements extending the original Envision ERP functionality.
Sage recognized e2b teknologies as their Gold Development Partner of The Year in 2011 and 2013 for Sage 500 ERP and Anytime Collect. e2b has also expanded its product portfolio beyond Sage 500 to include Sage 100, Sage X3, Epicor, Solver BI360 and other award-winning business applications.
A complete history of Sage 500 and additional information is available in the comprehensive Sage 500 ERP Owners Manual by e2b teknologies.
Sage 500 has been installed in a variety of industry segments but is an especially good fit for wholesale distributors with discrete manufacturing and/or service management needs. It is not natively a fit for process manufacturing although there is a third party product available for this industry. Project accounting is available albeit not as strong as other products on the market such as Deltek or Microsoft Dynamics SL (and many others). Due to it’s open architecture, it is a popular choice for companies in specific niche industries that cannot find canned ERP systems to meet their exact needs. For example, Sage 500 has a significant customer base involved in the network marketing industry.
Target Company Size
Sage 500 sits on top of the SMB ERP space into the SME ERP segment for companies with generally 100 to 1000 employees or $10 million to about $500 million in revenues. It is an excellent product for multi-site businesses except for those with multi-lingual requirements or international taxes.
Sage 500 is written in Microsoft Visual Basic and .Net. It was one of the first ERP product optimized exclusively for the Micosoft SQL Server database. It is typically installed on-premise but may also be deployed in virtualized environments or as a hosted application.
Sage 500 is available exclusively in English and does not support international business requirements. As such, it is predominantly used inside the United States. There are a handful of customers using Sage 500 in Mexico through a third party Spanish translation and there are a few dozen customers in Canada, throughout the Caribbean, and a few in other parts of the world including the UK and Australia.
Sage 500 includes dozens of accounting, distribution, and manufacturing modules including business intelligence, payroll, human resources, and much more. In addition, there is a significant third party app community with dozens of products to extend Sage 500 functionality. A complete suite of add-ons for inventory and manufacturing are sold by e2b teknologies as the Anytime 500 Supply Chain Suite including Quality Management, Cost Modeling, Enhanced MRP, Sales Forecasting, Engineering Change Orders, Kanban Replenishment, Enhanced Inventory/Lots, Batch Process Production Entry, Enhanced Costing, Routing Step Copy, Sub Work Orders, Work Order Splitting, Work Order Allocations, and Forecast Modeling.
At its peak, Sage 500 had perhaps as many as 4,000 active customers. Today there are probably less than 2,000 companies using it but they are loyal customers who understand the value proposition of the product. Customers interact on Sage City, an online user community and meet at Sage Summit, the annual user conference and exposition. A few partners integrate Sage 500 with their Sage 100 regional user groups for their customers and there are several forums and independent groups on LinkedIn and other social platforms.
Sage 500 Cost
Sage 500 was historically sold as a perpetually licensed product. Existing customers may still buy modules and pay the optional, annual maintenance and support plan. New customers may subscribe to Sage 500 with prices comparable to that of similar products including NetSuite, and Microsoft Dynamics GP. Pricing is slightly higher than Sage 100 c. Implementation costs are typically 50% more than the original software purchase or double the first year subscription cost (e.g., a $30,000 SLP purchase will cost about $45,000 to implement and a $20,000 subscription will cost about $40,000 to implement).