SAP Business One vs. SAP Business ByDesign: the best SAP for SMEs

• SAP Business One and SAP Business ByDesign are both built for small and mid-sized companies and have little in common with SAP ERP.
• Business One runs in the cloud or on your own servers, with or without HANA. ByDesign is available only in the cloud and only on HANA.
• Business One is the more flexible system, with an SDK and the Integration Framework. ByDesign relies on best practices and shorter implementations.
• The boundary is fluid: Business One is typical for up to around 250 users, ByDesign for up to around 500 users.

This article was first published on 26 November 2020. The figures on user limits, localisations and integrations date from that time. According to SAP (December 2025), SAP Business One is now available in 50 country versions and 28 languages.

SAP for SMEs: Business One and Business ByDesign

With SAP's sometimes rather creative ideas and constant renaming of its products, it's easy to lose track. That's why in this article (you'll find the accompanying video here) we take a look at SAP Business One and SAP Business ByDesign.

"Isn't SAP only for large corporations?"

You still hear this from small and mid-sized companies time and again. That may have been true 30 years ago, but there are now also SAP solutions for SMEs: SAP Business One and SAP Business ByDesign. Both were developed for SMEs, that is, small and mid-sized enterprises. They have relatively little in common with their big brother, SAP ERP.

To some extent SAP Business One and SAP Business ByDesign fish in the same pond and compete for the same SMEs. In a nutshell, SAP Business One is a solution that can be used from just a handful of employees upwards and can be run both in the cloud and on the company's own server. SAP Business ByDesign, on the other hand, is a purely cloud-based solution that cannot be run on a company's own server.

SAP ERP landscape

Let's take a closer look at how SAP Business One and SAP Business ByDesign fit into the big picture of SAP's business solutions.

All of SAP's new solutions are based on SAP HANA technology, the in-memory database that enables much higher performance and therefore dynamic analytics. Overall, there are solutions that can be run on-premise, that is, on a server within the company itself. On the other side are solutions that can only be run in the cloud.

SAP Business One is positioned in the small enterprise segment. As already mentioned, SAP Business One can be run both on-premise and in the cloud. SAP Business ByDesign sits in the medium enterprise segment. Here there is only a cloud version of Business ByDesign, so this system cannot be run on your own server.

Note: Business One can be used for several hundred users, and Business ByDesign can be used with as few as 10 users. So, as we can see, the boundary between the two solutions is fluid.

Finally, the large enterprise segment is covered by SAP S/4HANA, which can be run both on-premise and in the cloud. You'll find more information on SAP S/4HANA in other videos on our YouTube channel.

Direct comparison of Business One and ByDesign

Now that we know how SAP Business One and SAP Business ByDesign are positioned in SAP's solution landscape, it's time to compare the two systems directly.

In general, SAP Business One is ideal for SMEs that want full flexibility in implementing their business processes. SAP Business ByDesign, by contrast, is designed to let SMEs introduce an ERP system quickly using best practices.

Company size

In terms of company size, SAP Business One can be used from a handful of users upwards. Thanks to the cloud version of SAP Business One, there are no real upper limits either. Typically, however, the upper limit for SAP Business One is reached at around 250 users. SAP Business ByDesign may be placed in the medium-size enterprise segment on various colourful SAP presentations, but in practice it is regularly used from around 20 employees. The typical upper limit is 500 users, although here too, thanks to cloud technology, thousands of users would theoretically be possible.

Cloud vs. on-premise SAP Business One can be used both in the cloud and on-premise, that is, on a company-owned server. That provides additional flexibility and is a clear advantage over SAP Business ByDesign, which is available only in the cloud.

Support

Both systems offer SAP HANA support, although SAP Business ByDesign can only be run on HANA, while with SAP Business One you can choose whether to use SAP HANA or save yourself the cost.

Customisation

SAP Business One is a very flexible system that allows a lot of customisation. There is also a dedicated SDK and a middleware solution called SAP Integration Framework. With SAP Business ByDesign the focus is more on best practices, and 255 out-of-the-box integrations are provided.

Localisation

SAP Business One has 44 localisations and 28 languages. For SAP Business ByDesign the question isn't quite so easy to answer. A distinction has to be made between 20 "genuine" localisations and around 100 localisations that are either "pre-localised" or offered by partners. Accordingly, the quality levels of these localisations also differ.

Implementation speed

When it comes to project implementation speed, SAP Business ByDesign is ahead, at least on paper. Implementation projects can theoretically be completed in a few weeks, provided the best practices are actually followed.

In practice: the example of Lederhosen AG

Let's look at all this using our fictional company, "Lederhosen AG". Lederhosen AG is a traditional mid-sized company that produces and sells traditional costume fashion such as lederhosen and dirndls. It has to supply its own shops as well as its online shop and retailers with products.

Lederhosen AG has been using SAP ERP at its headquarters in Austria for some time. As part of its further expansion, a small warehouse and its own sales team are now to be set up directly in South Tyrol.

This new site in South Tyrol's capital, Bolzano, needs only a fraction of the complex processes required at Lederhosen AG's headquarters in Austria.

Since a complete rollout of the large SAP system, SAP ERP, would not pay off financially here, the plan is to use one of SAP's two smaller solutions, SAP Business One or SAP Business ByDesign, and then connect it to the SAP ERP system at Lederhosen AG's headquarters.

After some analysis, the decision finally falls on SAP Business One, because this solution can be run both in the cloud and on-premise, that is, on Lederhosen AG's own server. In addition, the capabilities of the SAP Integration Framework, which is available with SAP Business One, left a lasting impression. Why? Because it also allows specific integrations between the South Tyrol Business One system and the SAP ERP at Lederhosen AG's headquarters.

No sooner said than done: after a relatively short implementation project of only a few months, the SAP Business One system in Bolzano is set up and the relevant processes have been connected via the SAP Integration Framework to the main SAP ERP system at Lederhosen AG's headquarters in Austria.

Lederhosen AG is pleased with how quickly the project was delivered and with the simplicity of the system, which means the new employees in South Tyrol can be trained faster.

At a glance

SAP Business One and SAP Business ByDesign are both SAP solutions that cover the SME segment.

SAP Business One is the more flexible system, allowing several choices: in the cloud or not, HANA or not, and with the Integration Framework it also offers easy, flexible connection to other systems.

SAP Business ByDesign prescribes considerably more through best practices and can only be used in the cloud, but in return offers much faster and shorter project times. So, as we can see, both systems have their strengths and weaknesses. Depending on which requirements matter more to the company, either SAP Business One or SAP Business ByDesign is the better choice.