How Sage Could Instantly Recoup Millions in Lost Revenue

Yesterday Sage emailed their mid-market consultants and announced they were closing a loophole which over the last 7 years caused the lost revenue opportunity of $ 80 million dollars.

The loophole that Sage closed was one where purchasers of Sage ERP MAS 90 or 200 who bought prior to 2003 were not charged one dime for user licenses over the initial 5 user count.

Starting April 2011 Sage is fixing this — and all users will now pay maintenance on their user licenses for Sage ERP MAS 90 and 200 no matter when they purchased them.

But there’s another windfall that I think Sage has missed on the Sage ERP MAS 90 and MAS 200 side of the product line.

Sage’s Biggest Potential Windfall: Expiring Unlocking Codes Across All Product Lines

Most clients are aware that when they purchase MAS 90 or MAS 200 there are unlocking codes required to install and operate the software.

And a large number are  aware that these codes don’t expire even if they cancel maintenance with Sage.

This is unlike competitors who often lock their users out of future software upgrade or tax table updates (Intuit) unless they purchase an annual upgrade with a new license key.

Sage possibly leaves millions of dollars on the table every year by not adopting what is increasingly an industry standard of requiring users of software to be active on maintenance or face the shutdown of part or all of their accounting software functionality.

What Sage could do is issue new unlock codes as their annual maintenance is collected. These unlock codes would allow for full functioning of the system while those without new unlock codes might be excluded from opening new fiscal years, updating tax tables or entering transactions into a new year.

Sage’s competitors on the SaaS front in effect already have these expiring plans. When SaaS (Software As A Service) customers stop paying maintenance — all access to their data also ceases.

Why shouldn’t it be the same way with all of Sage’s products. Isn’t that Sage’s greatest opportunity to increase revenues?