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Alert: QuickBooks Enterprise Moves to Subscription Only Price Model

As one of the top QuickBooks Enterprise Premier resellers, I wanted you to be aware of some breaking news.

QBES 2015 Box Shot (left)A seismic shift is happening in QuickBooks Enterprise land, starting on Monday, October 6, 2014...

Starting then, the ONLY way to purchase QuickBooks Enterprise software will be by paying an annual subscription fee (either monthly or one annual payment). No longer will you be able to "pay once" and use the software as long as you want (be sure you see the details below on just how this is going to impact your checkbook!)

Really?

Really.

CRITICAL STUFF YOU NEED TO KNOW

First and foremost, the information below ONLY applies to those purchasing QuickBooks Enterprise on or after October 6, 2014.

If you already own Enterprise, you can head directly to the "What if I Already Own Enterprise" section further below.

If you are considering a purchase of QuickBooks Enterprise, please read on.

YOUR CHOICE - SILVER, GOLD OR PLATINUM

So let's break it down...

Under this new annual subscription model, you will have a choice of subscription levels to choose from. Here is a list of your options:

  • QuickBooks Enterprise 2016 Silver Edition (1 year subscription) - this subscription level includes the QuickBooks Enterprise 2016 software, Full Service Plan and the Advanced Reporting capabilities. Internet access is required.

  • QuickBooks Enterprise 2016 Gold Edition (1 year subscription) - this subscription level includes the QuickBooks Enterprise 2016 software, Full Service Plan and the Advanced Reporting capabilities (everything included in the Silver Edition). It also includes a full year of the Intuit Enhanced Payroll Service for unlimited employees. Internet access is required.

  • QuickBooks Enterprise 2016 Platinum Edition (1 year subscription) - this subscription level includes the QuickBooks Enterprise 2016 software, Full Service Plan, the Advanced Reporting capabilities, a full year of the Intuit Enhanced Payroll Service for unlimited employees (everything included in the Gold Edition). It also includes a full year of access to the Advanced Inventory and Advanced Pricing modules for QuickBooks Enterprise. Internet access is required.

The choices you will make at the time of purchase will consist of:

  • How many users you want
  • Which edition (from the list above) you want to subscribe to

THE BIG IMPACT ON YOUR CHECKBOOK...

Let's take a look at a basic example so you can see how this is going to work.

To keep it very simple, I'll assume you are going to use the software for 3 years, aren't interested in upgrading to the new edition every year, that you want a 5 user edition of QuickBooks Enterprise, and don't have any need for Enhanced Payroll, the Advanced Inventory or Advanced Pricing modules.

  • Under the "old way" (before October 6, 2014), the list price of a 5 user edition was $3,400. You purchase the software and simply use it for three years. Your total cost over the three years was $3,400 (I'm leaving out the optional costs relating to the renewal of the support plan each year to keep this simple).

  • Under the "new way" (on or after October 6, 2014), you would choose the Silver Edition annual subscription. The base cost for a 5 user edition is $2,800 PER YEAR . Your new total cost over the three years is now $8,400. Keep this critical piece of information in mind - if you don't pay your subscription fee, QuickBooks Enterprise stops working. Bummer.
    IMPORTANT NOTE: I can get you discounts of 20% on the subscription price of QuickBooks Enterprise to lower your cost!

Of course, if you make other assumptions about the desire to upgrade to the latest edition every year or other variables, the numbers as presented above would change.

My goal with this example is to strip it down to the basics that many businesses would want - purchase the software and simply use it for 3 years.

Be sure to visit my web site for special offers, discounts, and details about QuickBooks Enterprise 2016.

ADDITIONAL THINGS TO KNOW ABOUT THIS CHANGE

Now that you've had a chance to digest how the subscription plans are going to work, let's get to other areas that will likely need clarification:

  • QuickBooks Enterprise is NOT becoming a "cloud-based" product. It is the same software as it has always been. It can either be installed on PCs/servers on a local network or it can be used via a QuickBooks Enterprise hosting service just like it always has operated. I cannot stress this enough - the software itself is NOT changing - just the way you buy it is!
  • Pay by the month or one annual payment - the choice is yours, but there is no discount for paying in full. Most all of my clients are choosing the monthly option to conserve cash.

  • There is NO choice of the "old way" or the "new way" when buying Enterprise - all purchases on or after October 6, 2014 will be offered on the subscription basis only.

  • Intuit reserves the right to make changes - they may offer discounts, they may not. They may make changes to the subscription levels. It's their call. As a reseller, I'll be right there in helping you sort out your options and getting you the unbiased insights you need.
  • Yes, the software will have a "kill switch" in it - if your subscription is not renewed, the software will no longer work. Since your QuickBooks database is a separate file from the QuickBooks program, you will still have the database. However, you won't be able to read the information in the database unless you have the software to go with it. See the dilemma you'll have if you don't renew?

BUT WHAT IF I ALREADY OWN ENTERPRISE?

As a current owner of QuickBooks Enterprise before October 6, 2014, you are not impacted by the new pricing model above. Here are the options available to you in the months ahead:

  • Choose NOT to renew your full service plan when it comes up for renewal - keep using the version of QuickBooks Enterprise you currently have installed. If and when you decide to purchase a newer version of QuickBooks Enterprise in future years, you will then fall into this new subscription model as described above.

  • Renew your current support plan when renewal time arrives - when you are presented with the invoice for the renewal of your full service plan, you pay the invoice, and then you get the free upgrade to the next edition of Enterprise and twelve months of access to the Enterprise support desk. 

    • Don't be surprised to see the price for the renewal going up! Intuit makes the determination of these amounts each year - we'll see how that all plays out over the next few years as this new subscription model takes hold.

  • Opt for the subscription plan - you can choose to opt in to the subscription plan at any time if you like.

ALTERNATIVES TO QUICKBOOKS ENTERPRISE?

My blog post on the topic of alternatives to QuickBooks Enterprise will provide you some additional insights and information to help in the understanding of how this whole thing has come to pass.

NEED HELP SORTING IT ALL OUT?

As a reseller of QuickBooks Enterprise, count on me in the coming weeks to provide you with the "straight scoop" about this very significant change in the way Enterprise is being sold.

Feel free to contact me with questions you have about purchasing QuickBooks Enterprise software.

WHAT'S YOUR TAKE ON THIS CHANGE?

Don't be bashful! Are you liking this new approach? Not liking it? Let's hear it! Please drop your comments in the comment box below...

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Comments

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Hi Gretchen:

Thanks for stopping by the blog to share your experience with the renewal of your QuickBooks Enterprise Full Service Plan.

You are correct - if you opt not to renew the FSP, you keep using QB Enterprise 2015 as long as you like (keeping in mind that Intuit supports their software for three years). You will still continue to get the updates/bug fixes that are issued for the software if you do not renew - you just don't get the upgrade to Enterprise 2016.

Once you decide to upgrade again (for example, QB 2017), you will then be subject to the annual subscription pricing plan in place.

As mentioned in my blog post on alternatives to QB Enterprise, even with these price increases, the pricing is still less than the competition.

Doesn't make it any easier to take a 237% price increase though - as an independent small business, I completely understand your comments.

Scott Gregory, QuickBooks Expert

Yesterday I received my annual renewal of my Enterprise Full Service Plan for 10 users. The charge to my credit card was $3,439.21. Last year it was $1,445.46. I HAD NO NOTICE OF THIS INCREASE.

This is absolutely ridiculous!

My understanding from QuickBooks is that if I cancel now and reject the charge, I Version 2015 is still mine, but I will not get any updates or revisions for it.

We are a small business and this is not affordable for us. We are not sure where we will go with this.

Good luck to other users.

I've cancelled my $1799.00 Full Service Plan Annual Renewal plan for our 5-User Intuit Quickbooks Enterprise. Never felt better. Last year, is was $1100 or so.

Intuit has become VERY greedy and obviously has no integrity. If they would really listen to their customers instead of their greedy accounting and marketing people, I'd stay with them. I simply wanted a small business accounting system that was securely located on my internal, private, and secured network that worked well. I've always thought this was Quickbooks Premier, Pro, and Enterprise. That is until they decided to make Enterprise only subscription based and jack the price sky-high. That's it. I'm done.

It's very sad to see a historically great company destroy themselves. I'll use this product for the next 3 years, then move to an alternative.

Goodbye Intuit.

Hi Donna:

Thanks for your comments and feedback on this new plan.

As of today, I'm not even sure Intuit has sent any messaging to the ProAdvisor program (I am one and I haven't seen anything yet) about these sweeping changes.

Remember that the Enterprise product is designed for a bit larger business than the Pro and Premier versions are.

We'll see how this all plays out...

Scott Gregory, QuickBooks Enterprise Expert

As a QuickBooks Advanced ProAdvisor, I think Intuit has lost their minds. There are a lot of Cloud Based and desktop alternatives at a lower price that clients will be going to.

I have thought they were trying to nickel and dime clients for years now. Do they not realize the products are for small to middle income business' who can't afford to have this kind of impact on their accounting software? Are they not making any money anymore? Or are they just becoming greedy?

Hi Marty:

Thanks for taking the time to post your comments and thoughts about this new pricing model - appreciate it.

Indeed, future posts will discuss what options may be available for businesses that fit in the QB Enterprise space.

Scott Gregory, QuickBooks Expert

absolutely insane of intuit! glad we purchased it couple years ago-i think they are going to price themselves out of the market-are they relying on their name and brand to skate through this?
If i were in the market, I'd certainly be shopping around-absolutely too high subscription price!
as a cpa who often gets asked about software, i used to say quickbooks-but now, I need to look at other options to recommend.
will you be analyzing cost of other similar software compared to this?
Marty

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