Scala is Market Leader in China for Second Successive Year

Latest report from IDC shows Scala maintains the No 1 ERP vendor space in China

London, 21 June 2001: For the second consecutive year, Scala Business Solutions is the number one ERP vendor in China. According to the latest bulletin released by IDC (International Data Corporation), Scala was the vendor with the largest customer base in China at the end of 2000, totalling 315 installations -- over 12% of all ERP installations in mainland China.

The IDC report, published on 15 June, shows that the total revenue generated from ERP software licenses and maintenance in China exceeded US$48 million in 2000, totalling 542 newly-installed ERP systems. This is up from the 485 new installations in 1999. (For more information, visit www.idc.com.)

"We are delighted to enjoy another year as the market leader in China," said Peter Bornschein, Scalas Managing Director in China. The fact that our global customers are expanding their businesses into China has certainly helped us in achieving this notable performance. We will continue to deliver high quality service and leading edge technology to help them further succeed in the Chinese market."

The unique characteristics of the ERP market in China are not only its specific legal regulations, but also the traditional way in which Chinese enterprises conduct business. For example, most state-owned enterprises still do not operate with ERP systems, so the market has huge potential for growth. How well the Chinese ERP market develops depends on how quickly Chinese enterprises grow.

With 13 years experience of selling and implementing ERP systems in China, Scala knows the intricate details of Chinese business processes and has added necessary local features to its software, which is fully compliant with government regulations and accounting standards. The bottleneck of the Chinese ERP market stems from companies relative inexperience with ERP, added Bornschein. As China will soon join the World Trade Organisation, enterprises will also start to realise the importance of business management systems. However, they are not aware of where to begin. What we do is to help them achieve management success, and position them well in their own increasingly competitive markets."

The future challenge for companies who already have streamlined their internal processes is the move to a more open economic world. According to Bornschein, the Internet has created a connected world where companies seamlessly communicate with their partners, customers and suppliers. With Internet technology, such as iScala software for doing business over the Internet, companies can manage their globally-diverse organisations centrally regardless of their location. Moreover, through data exchange technology, data can be shared in real time among different divisional ERP systems.

We believe that the lack of understanding about what an ERP system can do to help a business in China can be addressed by further training and consulting, which we offer our customers through our special training centers in Beijing and Shanghai," Bornschein concluded. The demand of ERP software will grow dramatically in China over the next couple of years. On the horizon we can already see high demand for integrated Internet technology, illustrating that we are well placed to supply world-class solutions to both local companies as well as the subsidiaries of global enterprises that are ready to expand the world of e-business in China."

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Notes to Editors

About Scala Business Solutions

Scala Business Solutions is a global software provider serving multinational companies. Scala makes global business simple with its world-class software for managing an e-business, combining traditional back office business management systems with software for doing business over the Internet. Scala provides a complete solution for its customers, and also works in combination with other providers to extend the scope its customers may need.

From offices in Europe, North America and the Far East, Scala delivers software that is available in more than 30 languages. The company implements its software through a network of direct offices and partners that together cover more than 100 countries. Local markets are also addressed through a network of dealers.

Scala is listed on the Euronext Amsterdam Stock Exchange (symbol: SCA). 2000 revenue was USD 71.2 million.

Visit Scalas website at www.scalaworld.com for press information including press releases, information for investors, and company and product information.

© 2001 Scala Business Solutions, NV. All rights reserved. Scala® is a registered trademark. Other trademarks or registered trademarks are the property of their respective owners.