Glossary
What is On-premise and cloud?
On-premise software is installed on a computer inside your business, so it works without internet but ties records to that machine and leaves backups to you. Cloud software stores data on the provider's servers and is reached over the internet from any device.
The main difference between the two models is where your records live. The rest follows from that: who takes backups, who installs updates, who can see the figures and what stops working when something breaks.
How it works in practice
A pharmacy in Pokhara on on-premise billing keeps the software and the data on the counter PC, sometimes shared with a second PC over the shop network. It keeps billing when the internet is down. But if that PC is stolen or its disk fails, the pharmacy can get back only what was in its last copied backup. The owner also has to phone the shop to learn the day’s sales.
The same pharmacy on cloud software bills from a browser. The records sit on the provider’s servers, backups and updates are the provider’s job, and the owner can check stock from home. When the connection drops, billing waits until it returns or a mobile hotspot takes over.
Common mistakes
- Comparing feature lists. Both models can issue a bill that meets the rules. The bigger difference is who carries which risk.
- Assuming the shop PC is the safer place. One machine is exposed to theft, power damage and the backup nobody remembered.
- Assuming cloud needs no preparation. A second data connection matters more than the software choice.
- Skipping the export question. Whichever you pick, confirm you can take all your data out yourself.
When cloud is not worth it
If the connection where you trade fails for hours at a time and mobile data does not cover the gap, on-premise is the honest choice. The same holds for one person on one machine whose accountant already works in the same desktop package.
The full comparison, including the conditions the Electronic Billing Procedure 2074 attaches to cloud billing and the questions to put to any vendor, is in cloud or desktop business software. For what moving from one model to the other involves, see data migration, and for the subscription model itself, cloud software (SaaS).
Glossary
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