Magento Open Source and Magento Commerce are both fantastic eCommerce platforms, but they have different value propositions and different total costs of ownership. While Magento Commerce is known as the enterprise solution, huge organizations use Magento Open Source happily and successfully. The size of your business is only one of many factors that will enable you to decide which version of Magento is right for you.
So what should inform your decision? Here are some things to keep in mind to help make sure that you choose confidently and independently:
1) How much will you spend on licensing fees over the lifetime of your website?
This is the first step you’ll need to take to understand the cost of moving to Magento Commerce. Here’s an example. If your license fee is $40,000 per year for a 2-year term, and then you renegotiate at renewal and the fee goes up to $45,000 per year for the next 2 years, and $50,000 for the final 2, you’ll have spent $270,000 in licensing fees alone for your site. While these are just sample figures, it’s important to consider the lifetime costs, and not just the initial license fees.
You’ll also want to keep in mind licensing fees during the development of your website, which can add up. You won’t be benefiting from Magento Commerce features during this stage, but you will be paying for them. This can put a short-term strain on your budgets.
2) What would the cost differential be to add the features you plan to use through extensions and customizations?
You’re probably focused on a few key features of Magento Commerce that you believe you’ll derive the most benefit from. Determining if you can replicate those features by adding Magento extensions, or having something custom-written, can be a wise decision. Considering our example of $270,000 in licensing fees for the lifetime of a site, it can make a lot of sense to get some quotes on having features added to Magento Open Source.
If you have to buy 2 Magento extensions for $500 each and have a custom extension written for $10,000, you’d still be only $11,000 in. Even if you spent an additional $2,000 a year maintaining additional extensions, you’d still be way ahead of what you would have spent on a Magento Commerce license. While these are only illustrative figures, running the numbers of your own project is a crucial step.
3) Can you get better versions of Magento Commerce features with addons for Magento Open Source?
Not every feature is Magento Commerce is the most premium or versatile. In many cases, you’ll find equally good if not more advanced systems on the open market. This includes systems to manage Reward Points, Gift Cards, Gift Registries, Multiple Wish Lists, Store Credits, Limited Catalog Access, Dynamic Rule-Based Product Relations, and Segmentation and E-mail Marketing features. The same applies for B2B functionality, like Quote Requests and Add to Cart by SKU features.
It’s also important to consider how much customization you may need to do to use meet your specific requirements vs. building custom features, or getting what you need from a robust extension or SaaS solution. In many cases, you may need to extend or customize Magento Commerce features to meet your unique requirements anyway.
4) What other upcharges do Magento Commerce site owners incur?
If you’ve ever planned a wedding, you know that as soon as you mention “wedding” prices from vendors increase. There are cases where that happens with Magento Commerce as well. Not as many developers have spent significant time with Magento Commerce when compared with Open Source. Additionally, extension developers will usually sell far fewer copies of their extensions for Commerce sites since there are a much more limited number of Magento Commerce stores, so they’ll often charge a significant premium. While this may simply be par for the course, it’s important to factor such increases into your short-term and long-term budgeting.
5) What if you’re happy with your web host?
This is the issue that we, as web hosts, run into the most. Unless you’re a good negotiator, Magento won’t necessarily go out of their way to offer your Commerce license without their cloud hosting. However, if you’re used to great support from a host like JetRails, you may very well find yourself paying for Magento’s Cloud hosting but coming back to host at JetRails. JetRails tailors hosting environments, provides true auto-scaling, monitors sites, and most importantly, provides premium service in ways that Magento’s Cloud does not. We pick up the phone within seconds for anything and everything, where Magento Cloud users can anticipate waiting days for responses on even basic tickets. That puts merchants at risk, as there are lots of things that can impact your bottom line that may not be resolved nearly as quickly as they should be.
Here’s a look at the Magento Commerce Cloud SLA, which describes response time windows:
This shouldn’t stop you from upgrading to Magento Commerce, but it should empower you to speak with Magento AND with your current host to understand the actual differences in their hosting offerings. Most importantly, you should not feel pressured into paying for Magento’s Cloud if it’s not what you want. Magento does still offer Magento Commerce licenses without their cloud hosting bundled in. You just need to be direct with their sales team about your needs. Magento’s Cloud does not host users selling CBD items, that need HIPAA Compliance, or that needs true autoscaling. If you want to continue to experience premium hosting support from people that know you and your site, you still have options.
6) What if you want to downgrade in the future?
While we hope that you see many years of growth, we’ve all lived through recessions, downturns, and disruptions in the market. So, what happens if you get buyers remorse and want to downgrade back to Magento Open Source?
You can expect to still pay the remainder of your Magento Commerce license balance but you’ll have to vacate your Magento Commerce site before your license runs out. Otherwise, you’ll be pressured to renew your license – Magento doesn’t have to prorate your license, even if all that you need is a few extra days or weeks before you shut down your Magento Commerce site.
7) What if you’re only considering Magento Commerce because you’re anticipating future growth?
With Magento 1, if you wanted to go from Magento Community Edition (CE) to Magento Enterprise Edition (EE), it was a major undertaking. Did you know that you can upgrade from Magento 2 Open Source to Magento 2 Commerce without a full rebuild? If you didn’t, check out this helpful DevDoc article from the Magento team: https://devdocs.magento.com/guides/v2.3/comp-mgr/upgrader/ce-ee-upgrade-start.html
If you’re thinking about getting a Magento Commerce license because of projected future growth, you now have an easier mechanism to stay on Open Source and upgrade to Commerce when the time is right. This can help you focus your budget on marketing and growth now, without making it as hard to upgrade to Magento Commerce later.
Hopefully, these questions help empower you to make the best long-term decision for your business. We know that, with hundreds of thousands of dollars on the line, this sort of due-diligence can be extremely helpful.
Do you still have questions? Want to talk to the JetRails team, or to a recommended agency that works on Magento Open Source and Magento Commerce projects? We’re here to help! Reach out to our team for a consult, or to be matched up with one of our recommended Magento agency partners.