Canada Association of Tourism Employees

Causes Why Your Present LMS Price Might Outcome So Excessive

Are your LMS costs too high?

You expect your LMS to offer the very promising price-performance ratio. This is due to the lower training costs and increased skills of the staff, resulting in fewer compliance-based money issues. But the hidden costs are swinging the scales in the wrong direction, that wasn’t what was expected! The dilemma going forward is whether to pay more upfront or risk a multitude of hidden costs. Not only could license and maintenance costs arise, but your personnel costs could also skyrocket. Here are 6 main reasons your LMS costs could be higher than originally planned.

Hard costs to consider

So you know this cost. They were advertised from the start. However, they are part of the overall cost picture, so we need to examine what you are paying for.

1. You haven’t looked past the setup fees

One-time installation costs such as training, support, setup, and customization were part of the original agreement you signed. You knew that all of this would be part of your business case. However, you may not have realized that paying more up front can actually save you in the long run. Perhaps you have chosen to avoid this cost with a “free” option, and as we all know, there is no such thing as free.

2. You made a mistake with pricing models

There is no doubt that predicting exactly how you will be using a system can be difficult. Especially if you are new to LMS. Perhaps, now that you are below, you have realized that you made a mistake with the pricing model you selected. Has anything changed in the organization since you signed your LMS agreements? Is there a staffing that you missed that is now affecting your pricing model and LMS costs?

Let’s take a quick look at the 2 most popular pricing options.

  • Cloud-based pricing models
    You may have opted for a pay-per-user model. Cost based on the number of registered or active users. Or, depending on the number of times a course or module was accessed, you paid based on usage. Perhaps you paid for a time-limited license that wasn’t limited to users. Has anything changed in business that has seen an increase in user numbers? Maybe there was an acquisition or part of the company was sold. You could be left with a model that is no longer fit for purpose.
  • Self-hosted pricing models
    If you have opted for in-house hosting, you have still paid a one-time or annual license fee. Are you getting value for money now? Were there wage costs that you did not take into account? For example, having to hire an IT expert to do the backend coding or adapt the platform.

Do hidden costs pile up?

Aside from the obvious costs that have been agreed in advance, learning management systems are often known for having their fair share of hidden costs. Have you been plagued with hidden administration, maintenance and support costs that you weren’t expecting?

3. You have chosen an open source LMS to save money on implementation

Yes it seemed free. But your organization needs to customize and manage the system from the start. There is an enormous amount of time required that is very difficult to estimate. You have an initial server cost, but it’s so difficult to predict which configuration will be needed. You may pay more for server upgrades later. Add in the ongoing hosting and security costs, which can increase annually. Then you come up with all of the costs associated with running an effective online training program. The labor cost of customizing features, user interface, design, and staff training can be far higher than you predicted. It is almost impossible to accurately predict the requirements for your employees in connection with the operation of an LMS.

4. You have not budgeted support costs

A classic mistake when implementing an LMS is planning to do everything within the existing L&D team. In the end, most have to hire an LMS administrator because they are so overwhelmed and the learners are dissatisfied. If you haven’t agreed to this in advance, support teams can be costly and can affect your LMS costs. In addition, updates and maintenance costs are always incurred throughout the life of the system.

5. You didn’t have enough developers in house

With so many expectations of your LMS, your developers will be overwhelmed. This can lead to unexpected outsourcing of course development or internal training costs. In some cases, companies even run the risk of losing their best L&D talent simply because they are overwhelmed. This means that you have to hire a replacement and train them to use the system.

6. You did not involve the right experts in the selection and implementation phase

Were procurement, IT, L&D and high-level stakeholders part of the project team? If not, you may have made the wrong decision about what is needed and how to implement and support it. Everyone should be involved in the initial phase so that they can contribute their unique expertise and recommendations.


Because of the many hidden costs, your LMS costs could be way over budget. It is generally accepted that paying higher hard costs up front might be better. Choosing a fully supported LMS with a development team can save you money in the long run. They can help with the creation and conversion of materials. They are fully trained and experienced experts who can customize your system and keep it up to date. Choosing a new LMS provider is fraught with uncertainty. If you have no in-house experience, your best bet is probably to hire experts now and save costs later.

Have you created a requirements list for your new LMS platform? Have you taken all costs into account? Can You Really Afford Your Top LMS Contenders? Get a free LMS consultation to help you find the best learning management system for your company.


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