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SAP Business One vs Microsoft Dynamics 365: Which one is right for you?

Thursday, February 24, 2022

Whether you’re an established global organization or a start-up with plans for international expansion, your ERP solution needs to support and enhance your specific business model—today and tomorrow.  

Two of the world’s most popular ERP solutions on the market are Microsoft Dynamics 365 and SAP Business One (SAP B1). Both offer great flexibility and can be scaled up to enterprise level, but there are differences. In this blog, we’ll look at some of the features and functionality of these two products and provide a comparison to help you decide. 

Two scalable solutions  

Microsoft Dynamics 365 [formerly known as Navision, NAV, Axapta or AX] has been present in the market since 1987 and has evolved and grown over time. Today, this feature-packed solution offers improved operational efficiency and productivity all integrated within familiar Microsoft Office tools. 

Originally launched in 1996 (under the name Top Manage), SAP Business One is specifically designed for small to midsize businesses. It includes everything from accounting and financials to purchasing, inventory, sales, and customer relationships.

Both Dynamics 365 and SAP Business One offer modern ERP functionality. With great scalability up to enterprise level, both solutions are deployed worldwide by local or multi-national organizations.  

Types of deployment 

One important difference between these two ERP solutions is how they’re deployed. SAP Business One is available on-premise or as a hosted solution through Amazon Web Services (AWS). On the other hand, Dynamics 365 is available on-premises or as a cloud-based solution—either in Microsoft’s cloud or on a partner-hosted cloud. Furthermore, Dynamics 365 supports simultaneous deployments ideal for instance when migrating between systems.  

Supported industries  

Designed as an industry-specific (vertical) solution, SAP Business One is popular within IT and Telecommunications companies as well as within research, human resources, and healthcare industries. In comparison, Dynamics 365 offers a more flexible product that is deployed by every size of organization across a wide range of industries and applications.  

Core functionality 

SAP Business One and Dynamics 365 offer robust features and functionality. Thanks to mobile access, both solutions ensure continuous, uninterrupted access to the system with easy remote access from anywhere in the world. There are however differences such as within their reporting engines. SAP Business One lets you access Crystal Reports which can be difficult in Dynamics 365. However, Dynamics 365 offers out-of-the-box Business Intelligence (BI) tools for delivering insights into customer behavior. Plus, because it’s a native Microsoft product, it often feels more familiar to users helping increase and drive user adoption. 


SAP Business One is available as pre-packaged or customized software solutions. Pre-packaged software includes packages for Business Intelligence, ECommerce, HR & Payroll, and more. It allows you to implement various add-ons to help with daily business operations. However, with just 37 SAP Business One apps available, SAP rely on their third-party partners to deliver add-ons for any functional gaps. For instance, SAP Business One does not include built-in payroll functionality so if process payroll is needed, customers need to rely on third-party add-ons.  

By contrast, Dynamics 365 offers more than 750 add-on solutions, all available on the Microsoft AppSource marketplace. Built on the Microsoft Azure infrastructure, Dynamics 365 syncs and seamlessly integrates with a broad range of Microsoft business applications. For instance, users will enjoy single sign-on with Office 365 for a seamless business ecosystem experience. 

In addition, Dynamics 365 is distributed as a Software-as-a-service (SAAS) platform so organizations only need to pay for the modules they use, allowing them to have tighter control of their budget. In comparison, SAP Business One deployments always include at least ten core modules that customers need to pay for regardless of whether they are needed. 


ERP software implementations allow global organizations to standardize data and business processes, so they have global visibility into all their operations. With out-of-the-box localized software, customers can simply select the localization for their country to enable market-specific business processes that always comply with local legislation. When it comes to localization, Dynamics 365 offers more localizations compared to SAP Business One localizations. Dynamics 365 is also currently available in more languages than SAP Business One 


Both Dynamics 365 and SAP Business One offer perpetual and subscription licenses. With SAP Business One, users enroll in one of the 4 licensing types designed for specific system users (financial, logistics, CRM, and professional users). Dynamics 365 offers a more cost-effective licensing structure with dedicated licenses for either users or devices. It also allows subscription licenses to be used for on-premise deployments.  


Comparing solutions can be valuable, but you also need to look at your specific business and what you want to achieve—what are your objectives and goals, and what’s stopping you from achieving them? SAP Business One and Dynamics 365 can effectively support both start-ups and large organizations. However, Dynamics 365 includes more functionality and offers greater scalability, flexibility, and lower implementation and ownership costs.  

But really, at the end of the day, the solution that’s right for your organization depends on many factors including your specific business needs and priorities, budget, and constraints. 

Want to know more? 

Regardless of the size of your organization, starting a new ERP implementation project is a major undertaking. It will impact all areas of your business and requires a large amount of time, resources, and money. The right ERP solution will ensure you have the flexibility and possibility needed to respond to future changes as your business grows, evolves, and changes.  

Get in touch with Pipol today to discuss the right solution for your organization.  

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