Software giant plans expansion on mainland

German business software giant SAP plans to invest more than US$2 billion on the mainland over the next four years to expand its business in the world's second-biggest economy.

'We have successfully grown our business in China over the past 20 years and now want to scale our operations to fully meet the needs of both enterprises and our eco-system,' SAP co-chief executive Bill McDermott said yesterday at a company conference in Beijing.

SAP, which started direct operations on the mainland in 1992, is a prime supplier of major enterprise applications such as business analytics, customer relationship management and human resource management software. It has also expanded into so-called enterprise mobility applications.

To bring services and support closer to its customers, SAP aims to hire about 2,000 people by 2015, open about five new offices and scale all support functions appropriately, McDermott said.

The company would also create more research and development facilities and train more experts and consultants. 'With this increased level of commitment, we will be better positioned to help Chinese enterprises run better,' SAP China president Hera Siu said.

SAP last month reported a 150 per cent increase in third-quarter net profit to Euro1.25 billion (HK$13.3 billion), up from Euro501 million a year earlier, on record revenue of Euro3.41 billion.

Its major competitors on the mainland include Hong Kong-listed Kingdee International Software Group, Beijing-based Ufida Software and Oracle, the world's largest business software supplier.

'We're typically seeing 35 to 40 per cent quarter-on-quarter growth on the mainland,' said Steve Watts, the president of SAP's Asia-Pacific and Japan operations.

Market research firm Gartner has forecast the mainland's share of the Asia-Pacific software market to reach 30 per cent by 2013, representing US$9.4 billion in revenue.