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On-premise vs cloud ERP: how to choose

An ERP system can run in the vendor’s cloud, where you sign in through the browser and the vendor runs everything, or on premise, on a server your company controls. Both can run the same business processes. The difference is who owns the infrastructure, who does the work of keeping it running, and where your data lives.

This guide compares the two honestly and ends with questions that usually decide the choice.

The short comparison

Cloud ERPOn-premise ERP
Cost patternMonthly or yearly subscription per user; no server to buyLicence plus your own server, power, backup storage and IT time
Time to startDays: register, set up, import dataLonger: prepare a server, install, secure and back it up
UpdatesDone by the vendor, usually automaticallyDone by your team, on your schedule
Data locationThe vendor’s data centre, in the region it choosesYour building or your own data centre
Security workShared: the vendor secures the platform, you manage usersMostly yours: server, network, operating system, backups
InternetNeeded to workCan work inside your network without internet
ScalingAdd users at any timeMay need a bigger server as you grow

When cloud ERP is usually the better choice

  • You have no IT team, or a small one that should not spend time on servers and backups
  • You want to start quickly and pay as you go
  • Your team works from several sites, from home or on the road
  • There is no rule requiring your data to stay in a particular country or building

When on-premise ERP is usually the better choice

  • Laws, contracts or customers (often government, defence or aviation) require data to stay in your country or on your premises
  • Your sites have unreliable internet, but the system must keep working
  • You already run servers and want full control of updates, backups and access
  • You prefer a licence to an open-ended subscription

Questions that decide it

  • Where must our data be stored, by law or by contract?
  • Who will install updates, take backups and test restores, and how many hours a month can they give it?
  • What happens to our work when the internet is down?
  • What will the total cost be over three to five years, including hardware and staff time?
  • Can we move from one model to the other later without changing systems?

Keep the choice open with Solventro

Solventro runs both ways. Solventro Cloud is hosted by us on Google Cloud in Frankfurt, priced per user with a 30-day free trial. The self-hosted edition is the same system on your own Windows, macOS or Linux server, with a graphical installer, signed updates with automatic rollback, nightly backups and offline licences for closed networks; it is quoted individually. Many companies try the cloud first and decide afterwards.