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How Much Does Dynamics 365 Cost?

We always want to make sure our customers are well informed about the buying process and the included features in a system. So, we hope to explain how much exactly Dynamics costs?

It’s important to consider the actual price of implementing Dynamics into your business. Now, the answer will vary because the product’s vast capabilities that can support a small, local business to a large, global business. The key factor is Dynamics’ subscription model.

What is Microsoft’s subscription model?

The subscription model, or cloud-based model, removes the need to spend £10,000 per server for software.

Microsoft now handles all the computing infrastructure within the subscription model. That means Dynamics can be scaled to meet the needs of a micro-business (1-2 users), a large business (more than 100 users), and everything in between.

server rack

Now, Dynamics is also used with corporations and global companies, but let’s focus on cost factors for small- to medium-sized businesses.

What’s included out of the box, and what needs customisation?

If you have Dynamics 365 Sales, out of the box, your monthly subscription cost will include:

  • lead management
  • account and contact management
  • opportunity management
  • providing quotes in a product catalogue (for product- or service-based businesses)

A lot of functionality already exists in Dynamics. Now, the questions is whether you want to start to tailor that functionality to fit in with your company’s processes. To tailor Dynamics, you’d create custom fields, processes and workflows which can replicate and improve your existing processes.  

Before any customisation, the Dynamics lead form includes over 100 fields, capturing first and last name, addresses, job details, etc. As for account and contact records, there are about 200 fields from the start.

So if you want to just use Dynamics 365 as a simple, uncustomised contact and account management system, the starting cost would be approximately £2,000.

This would cover provisioning the environment, confirming licencing, and training users. Because Dynamics has excellent core functionality, you could get started right away without paying for additional customisation.

How does customisation increase Dynamics costs?

More customisations will increase the implementation price and make systems more complex to maintain.

Just like when buying a car and adding upgrades, the price increases when adding features.

We have set up systems for prices ranging from £2,000 up to £500,000. However, the typical range for a smaller business, maybe 5-20 users, could cost between £5,000 to £50,000. These costs cover the whole of Dynamics implementation: analysis, design, testing, building, retesting, deployment, change management, project management, and rolling out the final product.


Which features will increase costs of implementing Dynamics?

  • Document management
  • E-signatures
  • Customisation of plug-ins
  • Integration with other platforms
  • Replicating existing processes exactly

You may want to integrate your finance system, such as Sage, Business Central, or Xero. But if you want to integrate your orders and/or invoices into a finance system, that would be an additional integration.

If you want to automate your lead process, your follow-up process, reassign stale leads, or trigger automated notifications, a workflow development would be necessary.

Because this takes more time, understanding, and testing, the price goes up for these modifications.

You may want to integrate your telephone system. You could have number recognition, automatically showing each caller’s details and recording the call on the system.

All this additional configuration required would also bump up the price. However, the advantage is making your processes much more efficient.

Marketing automation is another additional investment to consider. The software may cost about £500 a month, but the most important factor is content process structure ensuring proper automation.

How can implementation costs be reduced?

We get a lot of customers coming to us saying “we want it to do leads, sales processing, sending and receiving quotes, e-signing, order management and product catalogues”

And whilst Dynamics can do all of this, they want it for £15k. That’s not going to happen.

Why’s it not going to happen?
Because if you think about the amount of time involved to understand the business, to configure the system, to get the plugins to work correctly, to do all the testing, to train users, to deploy it correctly… £15,000 pounds gets eaten up very, very quickly.

That’s only 18 days work for an average £850/day Dynamics partner. So, if you break down those 18 days into what actually has to be done across analysis, design, testing, build, retesting, deployment, change management, project management, rolling out… there’s a huge amount to be done and if you can find someone savvy who can help out in the process, that’s fantastic!

If you want to reduce cost, there are plenty of Dynamics tutorial materials out there that can help. A tech-savvy team member might be able to navigate the Dynamics features on their own. If you trust this person to set up and customise Dynamics for your business, this could reduce the cost of implementation.

But working with a partner who brings cross-industry experience may save costs in the long run.

Why work with a Microsoft Dynamics partner?

  • Experience: in-depth knowledge of the platform and its unique configuration options.
  • Sustainability: understanding the interaction between businesses, data models, and software development to create sustainable solutions for your business.
  • Shortcuts: building in layers of functionality specifically for certain industries and certain sectors.

In the end, you can decide if you want to do the implementation yourself or seek a partner-led implementation. We have covered many of the associated costs, and when working with a partner who understands your business and the functionality of Dynamics, they can help you get the best out of Dynamics for your business.

The key is to understand what you want your system to do and be realistic about what you can manage as a business.


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