This blog was originally published in October 2017 and updated in September 2026.
Many organizations assume ERP support and maintenance fees are a predictable cost of doing business. What they often don’t realize is that those fees represent only a fraction of the true cost of keeping ERP systems running.
ERP maintenance, upgrades and self-support often consume a significant portion of budget and staff capacity. For OSG Corporation, a Japanese tool manufacturer, software maintenance and operations consumed 86% of the total IT budget, leaving little to fund new initiatives and innovation. This story of budgetary constraints is far from unique — it’s the reality for many organizations around the globe.
With IT teams under growing pressure to do more with less, there’s no better time to address common questions about your total ERP maintenance spend. Let’s delve into pragmatic ways to identify, calculate and measure the ROI of these expenses.
Breaking down initial ERP costs
How much does an ERP cost?
It’s worth noting that there’s no single price tag for ERP software. On average, mid-sized to large organizations pay anywhere from $500k–$5M or more for initial ERP software licensing or subscription fees and implementation. When organizations ask, “How much does an ERP cost?” they usually focus on the initial license or subscription price. But that’s just the start.
ERP costs vary widely depending on business needs, typically encompassing:
- Initial costs: ERP license or subscription fees and initial implementation fees
- Ongoing costs: Annual ERP maintenance and support fees, upgrade costs, subscription fees for cloud ERP software and internal staffing costs
- Indirect costs: The opportunity cost of delayed innovation, along with the expense of downtime during implementation, customization requirements, integration with existing systems and ongoing training for new team members
In short, the cost of an ERP is much more than just the software itself — something every organization should keep in mind.
How much does an ERP license cost?
This is a seemingly simple question with a not-so-simple answer, as ERP license costs vary depending on:
- Number of users
- Breadth of modules (finance, HR, supply chain, etc.)
- Industry-specific functionality
- On-premises vs. cloud deployment
For traditional on-premises ERPs, perpetual licenses are typically purchased upfront and calculated per user or per module. But as ERP software providers increasingly push for subscription-as-a-service (SaaS) models, the days of perpetual licenses seem to be numbered.
At first glance, cloud-based ERP pricing may seem more flexible, but subscription models typically combine the right to use the software and ongoing support for the software into a single contract. Cloud fees are notoriously unpredictable, making long-term cost comparisons difficult.
What many organizations don’t realize is how ERP licensing decisions directly influence future maintenance costs, which are typically calculated as a percentage of the original license value. The more you pay for your license, the more you’ll pay for support and maintenance down the road.
Looking at ERP maintenance costs after deployment
How much are annual ERP maintenance fees?
Most major ERP vendors charge annual ERP maintenance fees of 18–22% of the original license cost.¹ This means that a $1 million ERP license could result in $180,000–$220,000 per year just in maintenance fees, and a $10 million ERP license could result in a staggering $1.8–$2.2 million per year in maintenance fees.
These fees recur every year,² often increasing over time. Historically, vendor profit margins for annual support and maintenance have been 90% or higher. It is generally understood that maintenance fees are mostly used for the development of future releases and new products.
What do ERP maintenance fees actually cover?
Typically, annual ERP maintenance fees cover:
- Break/fix support for standard code
- Access to patches and updates
- Regulatory and tax updates
- Support portals and documentation
However, that’s only a part of what organizations need to keep their ERP systems running smoothly and aligned with business needs. Custom code support, performance and interoperability troubleshooting and business process optimization are all critical services not typically included in annual ERP maintenance fees. To make up for the coverage gap, organizations often rely heavily on internal teams or outside consultants for these services.
What’s the average cost of maintaining an ERP system after deployment?
After system deployment, ERP maintenance becomes a permanent operating expense. The total cost of ownership (TCO) for maintenance-related activities include annual ERP vendor maintenance fees, upgrades, self-support and customization management.
This explains why many IT budgets fall into the same trap — with an average 60–70%³ of spend going to operational support, security and compliance, leaving a small share for innovation.
Exploring the hidden costs of ERP
We’ve gone over the upfront costs of ERP, including direct and indirect costs. But now it’s time to check out the hidden costs of ERP that quickly add up over time and eat away at IT budgets.
Hidden cost #1: ERP upgrades
IT veterans know that ERP upgrades are among the most costly, time-consuming and disruptive events in IT. An organization that pays $1M per year in support fees may incur periodic ERP upgrade costs that translate to approximately $400k annually, depending on complexity.
What’s worse, ERP vendors will often push customers to upgrade to the latest software release or risk losing some of the support services they received before. And by the time organizations complete the multiyear upgrade project like their vendor wanted, it could be time to do it all again.
Upgrading just to stay on mainstream support takes away both capital and talent from innovation. Many organizations upgrade two or more times per decade — usually not because of business needs, but to maintain eligibility for full vendor support. Smaller, frequent updates via an enhancement or support pack don’t necessarily reduce costs either. Instead, they introduce additional testing overhead, ongoing churn and risk.
Hidden cost #2: Custom code support
Most ERP systems have customizations tailored to business needs. But ERP vendors typically don’t provide support for custom code. As a result, internal teams often spend countless hours troubleshooting customization issues, maintaining integrations across updates and proving to their vendor that custom code isn’t the root cause of failures. Continuing with our example, organizations paying $1M in annual support fees can spend a whopping $300,000 annually to support their mission-critical customizations.
Not all ERP issues are customization-related, yet vendor support often assumes custom code is “guilty until proven innocent.” The result is wasted time, delayed resolutions and mounting frustration.
Hidden cost #3: Reliance on self-support
Despite expensive ERP maintenance contracts, many organizations rely heavily on their internal teams to fix ERP issues when vendor support falls short. Though self-support can be more effective than vendor escalation loops, it comes with a high hidden price tag, especially when skilled staff are pulled away from strategic initiatives. Organizations paying $1M in annual support fees can spend an estimated $273,000 annually just on self-support — and that’s on top of the ERP vendor support fees. With such high ERP vendor support fees, you’d think your internal staff could spend time on other important IT initiatives, but this often isn’t the case.
Break free from high ERP costs
Are hidden ERP costs consuming a large and growing portion of your IT budget? If so, it’s time to look at other options. Disruptors don’t accept outdated cost structures as inevitable. By rethinking ERP maintenance strategies, organizations can cut annual ERP maintenance costs; avoid expensive, unnecessary upgrades; extend the life of existing ERP investments; and shift resources where they belong — innovation and growth.
Third-party support models offer an alternative to the status quo by providing support for customizations, stable environments and long-term ERP roadmaps without vendor-driven upgrade pressure.
Key takeaways
ERP systems may still be essential to day-to-day operations, but unchecked ERP maintenance costs can quietly undermine IT effectiveness and business agility. By understanding the true cost of ERP, challenging ERP vendor support models and considering alternatives such as third-party support from Rimini Street, IT leaders can shift from survival mode to strategic impact, freeing budget and resources to fuel the innovation the business demands.
¹ ERP Implementation Cost: A Comprehensive Guide [Budget Planning & Factors Explained],” Cudio, retrieved 8 April 2026 from https://www.cudio.com/blog/erp-implementation-costs
² “How to Not Waste Money on Oracle and SAP Support,” Brightwork Research and Analysis, retrieved 8 April 2026 from https://www.brightworkresearch.com/the-giant-margins-for-sap-and-oracle-support/
³ “Innovation vs. Keeping the lights on: How to prioritise in 2025,” FutureCIO, retrieved 8 April 2026 from https://futurecio.tech/innovation-vs-keeping-the-lights-on-how-to-prioritise-in-2025/
