11 Replies Latest reply on Feb 8, 2013 2:49 AM by kcapella

    FileMaker licensing for a non-profit in Tanzania

    kcapella

      I work for a small non-profit organization in Tanzania (East Africa) which does advocacy around children's rights. We have a FM database that we use for keeping track of program monitoring data, as well as case studies of child abuse that we come across. We're currently using FM11, with our server being a Windows 7 machine and our clients being Macs. We have 15 client licenses and 1 server license - these were purchased from FileMaker UK, and we're currently on an annual volume licensing agreement.

       

      This was all set up before I joined the organization, and we've just received a bill as our next year's annual payment is due. I was quite shocked at the cost - about 1500 pounds (2400 USD). That's quite a lot of money for a non-profit organization of our size, so I started looking around the FM website for pricing info. We really don't need 15 client licenses, so I put in 10 licenses plus one server license on the FM website, and got a price of $746 per year with non-profit pricing. Needless to say that's a HUGE savings over the $2400 we'd have to pay to FM UK, and it'd have the benefit of allowing us to move to FM12 (we employ a consultant who does work on the databases for us, and she'd transition them to 12's format).

       

      The problem is that I really have no idea how FM licensing works, and so I don't know if it's okay for us to purchase licenses directly from the FM website, or if being located in Africa means that we have to buy them from FM UK. Also, while we are a non-profit organization we don't have 501(c)(3) status in the US, so would that make us ineligible for non-profit pricing?

       

      If anyone could offer some advice on what the best way forward on FM licensing for us should be, I'd hugely appreciate it. Ultimately we'd like to have 10 Mac client licenses and 1 Windows server license (not Advanced) of FM12, with non-profit pricing if possible.

        • 1. Re: FileMaker licensing for a non-profit in Tanzania

          Please talk to your FileMaker sales representative.

           

          Winfried

          • 2. Re: FileMaker licensing for a non-profit in Tanzania
            Stephen Huston

            I agree with Winfried. I found that the FM website was harder to convince about non-profit qualifications than a sales rep at FMI, and I suspect they will be sympathetic, which you can't always get from a website.

            • 3. Re: FileMaker licensing for a non-profit in Tanzania
              kcapella

              I'll get in touch with the FM UK sales rep who we got the original licenses from and see what he says. But it's not just an issue of getting non-profit pricing, the cost of the licenses themselves is more expensive. Even if we stayed with our current license numbers (15 client, 1 server), FM's website shows a price of $1718 per year - and that's for FM 12. FM UK wants $2400 from us for the same number of licenses, but for FM 11. Part of the issue of buying them from the UK is that we have to pay the exorbitant VAT (about $400), but even removing VAT we're still getting charged almost $300 more than what we'd pay purchasing from the FM website. Why is that?

               

              As I said I'll get in touch with the sales rep and see about non-profit pricing, as well as what it'd cost for us to move to FM 12, but the discrepancies in pricing are a little concerning to me.

              • 4. Re: FileMaker licensing for a non-profit in Tanzania

                Hi Kcapella,

                 

                It's my understanding of VAT that you should not have to pay that tax when the licences are being used outside of the EU, unless your agency somehow happens to be based within the EU.

                 

                You also need to understand that FMI, like many other international companies, is hesitant to make pricing changes to always reflect the current currency exchange rates. That said, however, the US$ is currently weak and unlikely to recover its former strength anytime soon. Thus you should addd your voice to the need for a better realignment of their international pricing.  A squeaky wheel does get some oil every now and again!

                 

                Good Luck!

                 

                John

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                • 5. Re: FileMaker licensing for a non-profit in Tanzania
                  taylorsharpe

                  One thing to note in your comparison is that there are a few different licensing options.  One is Volume Licensing, which you have.  The 2nd you referred to is Annual Licensing.  Annual licensing is more like leasing.  You pay for it for a specified time and you must stop using at the end of that time.  With Volume licensing, you have a license to perpetually use the software with no time limits.  Optionally Volume Licensing allows you to purchase "Maintenance" which not only lets you use the current license you have, but entitles you to upgrades that come out if they are within the Maintenance period.  Annual Licensing also includes upgrades at no additional cost.  One question is comparing the Maintenance Cost of a Volume License to Annual Licensing since they basically get you the same thing (free upgrades to stay current with the software).

                   

                  Many software companies are pushing Annual Licensing and it is still fairly new to FileMaker.  But FileMaker is actively pushing it now.  The reason software companies are doing this is because traditionally, software companies only get a big infusion of money when they come out with a new version of software and a lot of their customers will upgrade.  This encourages the companies to come out with upgrades more frequently even when they might not be best for customers because the company needs an infusion of cash.  Moving to a annual licensing smooths out the income from customers and brings in a predictable amount of money each year regardless of how many upgrades come out or don't.  I guess the disadvantage is that there is less pressure on a company to come out with new upgrades quickly.  Regardless, it is becoming more and more common with many software companies and expect FileMaker to push Annual Licensing more and more. 

                   

                  And as recommend above, talk with your FileMaker rep about being a non-profit and they will get you the best price for whatever licensing you go with.  You will probably have to provide them some government documentation that you are a non-profit, but you only have to do it once and being a non-profit will save you a lot of money. 

                  • 6. Re: FileMaker licensing for a non-profit in Tanzania
                    kcapella

                    John,

                     

                    Thanks for the reply! Unfortunately we've been told by the FM UK rep that they have to bill the order to a UK address, meaning we have to pay VAT even though we're most definitely not located in the EU. What happened was the head of our organization (who is British) had initially purchased the licenses using her personal credit card. The problem is we want to get away from having her pay for things and then reimbursing her, so this time we want to pay via bank transfer directly from our organization's account. But the FM rep wants a UK VAT registration number (which we don't have), so I don't know if this will be possible.

                     

                    I'm not sure why they require a UK address to bill us - how are people who live in countries where there's no FM presence supposed to purchase licenses? You'd think in this day and age purchasing a software license would be easier, but it seems like FM is stuck on some kind of outdated business model.

                    • 7. Re: FileMaker licensing for a non-profit in Tanzania
                      taylorsharpe

                      I would still talk to one of the FM reps and see what they can work out for you.  But the problem is probably a legal one about licensing laws in Tanzania.  Obviously FM has made sure that their licensing is properly protected under UK law, but they may have never reviewed Tanzania law and the FM reps might not be authorized to sell there until a legal review is done.  That is more likely the problem, but purely a guess. 

                      • 8. Re: FileMaker licensing for a non-profit in Tanzania
                        jormond

                        I second Taylor's recommendation.

                         

                        It looks like South Africa has a web store directly from FM.  I didn't anything else that jumped right out at me being closer to you, but you would know better than me.  I call to FM may yield more options for you.

                         

                        http://www.filemaker.com/company/intl/

                        • 9. Re: FileMaker licensing for a non-profit in Tanzania

                          Hi Kcapella,

                           

                          I cannot see why the UK Office should be insisting upon billing to a UK address. It was probably convenient to do it that way for the initial purchase when the head of your organisation could claim back all of the VAT, but I cannot see why that needs to continue when you obviously don't have a way of claiming back that tax. Instead you could probably start afresh by going through the South African web store, so long as they can recognise your non-profit status.

                           

                          If the VAT tax laws are anything like our GST laws, then the UK office will NOT be required to report their VAT charged on a product sold overseas, giving them an extra profit margin on the sale. They may well argue that they incurr additional expenses in dealing with you, but I'd reject that line of reasoning, especially as the distribution process is now an electronic download + some routine documentation at their end.

                           

                          Many years ago, FMI had all of their international sales managed from their UK office. The Asia Pacific region broke away from that shackle several years ago with an immediate improvement in dealings with the mother ship. Nuff said!!

                           

                          Good Luck!

                           

                          John

                          1 of 1 people found this helpful
                          • 10. Re: FileMaker licensing for a non-profit in Tanzania
                            AlanStirling

                            Hi Kcapella

                             

                            I've not been happy reading about your problems renewing your Annual Volume License agreement and with the response you have received from FileMaker UK, so today I spoke to the licensing specialist at FileMaker UK, to find out what had happened.

                             

                            Your Annual Volume License agreement was bought last year by a business here in the UK, with VAT, with no word that it was going to be used in Tanzania.  At the time of the first renewal, FileMaker UK has sent out the standard renewal contract to the company here in the UK, which has finally arrived on your desk in Africa. These Annual Volume License agreements are linked to a business at a particular address, which in this case is in the UK.  This is why they can only renew using the same UK address and have to charge VAT.

                             

                            In my view this is the wrong agreement for you - or at least is based on the wrong address.  I suggest that you cancel this agreement and take out a new one with the FileMaker Agents for Tanzania. I understand they are called 'Winsoft International' and are based in France. (www.winsoft-international.com). They should be able to offer you a range of options to license your 10 users plus server, hopefully at educational prices.

                             

                            FileMaker UK have explained to me that they have offered you similar pricing, but because of the use of a UK address, they would still have to charge 20% VAT. Hopefully, Winsoft can avoid this.

                             

                            Please come back here and tell us how you fared ....

                             

                            Best wishes - Alan Stirling, London, UK.

                            • 11. Re: FileMaker licensing for a non-profit in Tanzania
                              kcapella

                              Alan,

                               

                              Thank you so much for all your help! Someone from WindSoft has already contacted us, and we've received a quote (with the proper pricing) for exactly what we need. And no need to pay tax!

                               

                              I think we've definitely managed to clear up all the confusion about our (likely not very common) licensing problem. We should be good to go now, and again - greatly appreciate all the help. I've certainly never had this kind of positive support experience from a message board before!

                               

                              All the best,

                              Kris