SAP makes local loss

SAP New Zealand has reported a loss of $1.73 million on revenue of $16 million for 2001.

SAP New Zealand has reported a loss of $1.73 million on revenue of $16 million for 2001.

The local operation was one of seven subsidiaries in the Asia-Pacific region that lost money, including Australia, Korea, Taiwan and the Philippines, according to the parent company's annual report.

In the past two years in New Zealand a number of companies such as Design Build Systems, started by former Zespri SAP staff, and Oxygen, based around CHH SAP staff, have been set up to help SAP sites extract more functionality from their enterprise resource management (ERP) systems. However, the overall ERP market has become saturated and vendors such as SAP are trying to interest buyers in add-on technology such as portals.

IDC New Zealand research found that in the services and solutions market last year, ERP was behind storage solutions, security and e-commerce. However, IDC analyst Mike Cranna says though the market is saturated there has been some uptake of what is described as the next wave of ERP software – front office modules. These modules, such as APO (advanced planning optimiser) and SEM (strategic enterprise management), give managers an overall view of how the business is doing and leverage the information contained in ERP systems to provide extra business intelligence.

Diary giant Fonterra recently signed up for SAP’s APO system. In January it chose SAP as its technology partner of choice over Swedish company Intentia. As well as providing the APO system, SAP will replace Fonterra’s inventory and order management systems, which included in-house and Oracle software.

SAP customers in New Zealand include the Police Department, Auckland District Health Board, Air New Zealand, Auckland City Council, Carter Holt Harvey and TVNZ. Kiwifruit marketing company Zespri is about to evaluate whether it will continue using SAP.

Cranna says SAP is still the ERP market leader in this country.

SAP also recorded losses at its Singapore-based subsidiaries SAP Asia Pacific solutions and SAP India (Holdings). SAP Australia lost $1.73 million on revenue of approximately $226 million. Several operations, including Indonesia, Japan, Singapore, Malaysia, India and Thailand were profitable, according to the annual report.

SAP NZ did not immediately return calls.

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