Dynamics 365 Business Central Essentials vs Premium

Dynamics 365 Business Central Essentials vs Premium

Apr 17, 2025 Aiswarya Madhu

Microsoft Dynamics 365 Business Central is an ERP (enterprise resource planning) system that helps small to medium-sized businesses unify and streamline critical processes.

From financial management and supply chain operations to sales and project management, it offers a comprehensive platform for managing core business functions.

With two distinct licensing options — Essentials and Premium — organizations can choose the level of functionality that matches their specific needs, whether it's standard business operations or advanced manufacturing and service management.

While the Dynamics 365 Business Central Essentials vs Premium debate often centers around pricing, the real difference lies in the functionalities each plan offers. The Essentials plan provides the fundamental tools necessary to manage everyday business operations, including financial management, sales, inventory, and project management.

On the other hand, the Premium plan extends these capabilities by adding specialized features designed specifically for manufacturing and service management.

This guide will offer a comprehensive comparison of Dynamics 365 Business Central Essentials vs Premium, breaking down their features, use cases, pricing, integration benefits, and decision-making tips to help you choose the best fit for your business.

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Licensing Options: Essentials vs. Premium

Feature Essentials ($70/user/month) Premium ($100/user/month)
Financial Management✅✅
Sales & Marketing✅✅
Inventory Management✅✅
Project Management✅✅
Warehouse Management✅✅
Supply Chain Management✅✅
Customization & Extensibility✅✅
Service Management❌✅
Manufacturing❌✅
Integration with Microsoft Ecosystem✅✅
Team Members Licensing✅✅
Explore 8 compelling reasons to choose Business Central, backed by real-world success stories.

Features of Dynamics 365 Business Central Essentials Plan ($70 per user/month)

The Dynamics 365 Business Central Essentials Plan offers the fundamental capabilities needed to run daily business operations efficiently. This plan is ideal if your business is focused on improving financial management, inventory control, sales tracking, project management, and warehouse organization without diving into complex manufacturing or service management. Here’s how this plan helps you achieve that.

Dynamics 365 Business Central Essentials Features

Financial Management

If managing your finances feels overwhelming, Essentials helps you simplify it.

With features like General Ledger and Bank Reconciliation, your financial transactions are automatically recorded and reconciled, giving you confidence that your financial data is accurate and current.

The plan includes Budgeting and Cash Flow Forecasting, allowing you to predict revenue trends and expenses accurately. This means you can make informed decisions with a clearer picture of your financial health.

Managing cost accounting and fixed assets becomes straightforward, helping you assess the true value of your resources. This ensures better asset utilization and cost management.

Handling multiple currencies and intercompany transactions is no longer a struggle. Essentials help you maintain consistency in financial reporting across different entities and geographies.

Integration with Microsoft 365 makes reporting smoother. You can connect your financial data to familiar tools like Excel and Power BI, making analysis and decision-making a lot simpler.

Sales & Marketing

Managing customer interactions can be chaotic if you lack the right tools. Essentials provides clarity.

With Contact and Campaign Management, you can build and maintain a well-organized database of your customers. This enables you to keep track of interactions and tailor your communication to their needs.

The plan makes Sales Invoicing and Order Management seamless, allowing you to create, manage, and fulfill orders without hassle. This results in faster processing and happier customers.

Email Logging and Opportunity Management allow you to capture conversations and follow up effectively, ensuring you never miss out on potential sales.

When paired with Dynamics 365 Sales Integration, you can consolidate your customer interactions and have a unified view of your sales pipeline.

Explore how Dynamics 365 Sales forecasting helps predict revenue and align sales efforts.

Inventory & Supply Chain Management

Struggling with inventory control and supply chain visibility? Essentials makes it simpler.

Item Tracking and Stock Management tools help you monitor inventory levels, ensuring you have what you need, when you need it.

When your business involves dealing with multiple locations, Essentials offers tools to handle location transfers and shipping agents, allowing you to keep operations running smoothly.

Managing purchases and returns becomes a breeze with Purchase Order Management and Return Processing. Essentials helps you establish clear processes for procurement and vendor interactions.

If forecasting feels like guesswork, Essentials offers Demand and Inventory Forecasting to help you anticipate inventory needs and avoid excess stock.

By supporting Alternative Vendors and Item Substitutions, Essentials gives you the flexibility to switch suppliers if needed, ensuring minimal disruption.

Read about 20 powerful supply chain features in Dynamics 365

Project Management

Tracking multiple projects and ensuring timely completion can be challenging. Essentials provides the structure you need.

The plan’s Resource Management and Capacity Planning capabilities help you allocate resources more effectively, preventing bottlenecks and ensuring timely delivery.

With Job Tracking, Time Sheets, and Task Management, you can monitor progress, log work hours, and identify areas where improvements can be made.

Project Costing and Profitability Analysis provide valuable insights, enabling you to refine your processes and make better business decisions.

Warehouse Management

Managing warehouse operations can be chaotic without the right tools. Essentials offers a simpler way.

Essentials provides tools for Inventory Picks, Put-Aways, Warehouse Receipts, and Shipments, ensuring your items are organized and easily accessible.

With Bin Management, you can categorize and store inventory effectively, making retrieval faster and more accurate.

Warehouse Management Systems (WMS) help reduce errors and improve efficiency by automating repetitive tasks.

Explore how Dynamics 365 Business Central simplifies warehouse management for SMBs

Features of Dynamics 365 Business Central Premium Plan ($100 per user/month)

The Dynamics 365 Business Central Premium Plan is an advanced version of the Essentials Plan, offering all the functionalities of Essentials along with enhanced modules specifically designed to meet the needs of manufacturing and service-based businesses.

Dynamics 365 Premium Features

Here’s how the Premium Plan benefits you:

Everything Included in Essentials

The Premium Plan encompasses all the features of the Essentials Plan. So, you get the functionalities of financial management, sales tracking, inventory control, project management, and warehouse organization.

But what truly sets the Premium Plan apart are its manufacturing and service management capabilities, designed to help you achieve more in industries where precision and process optimization are key.

Manufacturing

When you’re dealing with complex production processes, you need more than just basic inventory tracking. The Premium Plan provides advanced manufacturing tools that allow you to plan, monitor, and optimize production activities from start to finish.

Production Orders: This feature helps you transform raw materials into finished products efficiently. You can track the entire process, ensuring each stage of production is aligned with the set requirements.

Production BOMs (Bill of Materials): Define the structure of your products with detailed records of all required components. This ensures accurate planning and cost calculation, helping you reduce errors and material waste.

Supply Planning & Demand Forecasting: Stay ahead of market demand with powerful forecasting tools. By predicting future requirements and adjusting your production schedules accordingly, you can avoid overproduction and reduce inventory costs.

Routing & Work Center Management: Optimize your manufacturing workflows by defining detailed routings for each product. Managing machine workloads becomes much easier, allowing you to balance resources and maximize productivity.

Finite Loading: With this feature, you can plan production schedules that fit within the available capacity of your resources. This reduces bottlenecks and ensures timely fulfillment of orders.

Service Management

Managing service orders, contracts, and customer interactions can be overwhelming without the right tools. The Premium Plan provides specialized features to help you streamline your service operations, whether you’re providing maintenance, repairs, or customer support.

Service Order Management: This feature enables you to manage repair requests and maintenance schedules effectively. You can track each service request from start to finish, ensuring that customer issues are resolved promptly.

Service Contract Management: With the ability to create, monitor, and manage service contracts, you can ensure consistent and reliable service delivery to your clients. It’s a great tool for businesses with recurring service agreements or warranties.

Service Item Management: Track the lifecycle of your service items and maintain accurate records. Whether it’s repairs, replacements, or upgrades, having detailed information at your fingertips ensures you can provide excellent customer support.

Service Price Management: Ensure profitability by setting and controlling prices for your services. This feature helps you maintain consistency across different service orders and prevent revenue leakage.

Planning & Dispatching: Efficiently schedule tasks and allocate resources to technicians and field agents. This feature improves your response time and ensures tasks are completed within the desired timeframe.

Comparison of Business Central Essentials vs. Premium

You’ve seen how each plan offers different features. But if you’re trying to figure out which plan best suits your business, a high-level comparison can be incredibly helpful. The table below provides a simplified view of what each plan offers and where Premium offers extra value.

Criteria Essentials Premium
Cost$70/user/month$100/user/month
Target AudienceSMBs with standard needsManufacturers, service providers
Manufacturing FeaturesLimitedAdvanced manufacturing management
Service ManagementNot AvailableComplete service management tools
IntegrationMicrosoft 365, Power BIMicrosoft 365, Power BI, Power Apps
ScalabilityGoodExcellent for complex operations
Environment1 Production, 3 Sandboxes1 Production, 3 Sandboxes
Storage80GB80 GB

How to Purchase a Business Central license?

Here’s everything you need to know to get started with Business Central—how to buy a license, explore the trial version, assign users, and set up your environment the right way.

Purchase Through CSP (Cloud Solution Provider)

Business Central licenses can only be purchased through a CSP. A CSP is a Microsoft Partner authorized to sell Microsoft’s cloud services, including Business Central.

To purchase a license:

  • Find a CSP through the Microsoft Partner Finder.
  • Contact them to discuss your needs (Essentials, Premium, etc.) and make the purchase.

Self-Service Trial (Evaluation Version)

If you want to test Business Central before purchasing, you can sign up for an evaluation trial.

Trial Details:

  • Comes with 10,000 licenses (for testing, demo purposes).
  • Provides access to non-production environments to explore features.
Read more about Dynamics 365 Business Central for IWs and explore how you can test the platform with a free trial before making a purchase.

Assigning Licenses to Users

After purchasing, licenses must be assigned to users via Microsoft Entra ID (formerly Azure Active Directory).

The entitlements (permissions) are generated based on the license type. This ensures users have access only to the features included in their subscription.

Setting Up the Environment

Environments Available: 1 Production Environment & 3 Sandboxes (for testing/development).

Storage Available: 80 GB (additional storage can be purchased if needed).

You can set up and manage environments from the Business Central Administration Center.

Checking Permissions & Managing Access

When a user logs in, permissions are applied based on the entitlements associated with the user’s license.

To review permissions, you can check the Effective Permissions page in Business Central.

Important: Entitlements have higher priority over permissions. If a user is assigned a Team Member license, even if they have higher permissions granted by an admin, they will only be able to access functionalities allowed under the Team Member license.

Reassigning Licenses

Licenses can only be reassigned on a permanent basis or under specific conditions, such as to cover user absence or device unavailability.

License reassignment is restricted to avoid short-term assignments (less than 90 days).

Using Device Licenses

Device licenses are for shared devices accessed by multiple users, like POS systems or warehouse terminals.

You need to create a Device Users Group in the Microsoft 365 Admin Center or Azure portal.

Microsoft 365 Integration

Users with Microsoft 365 licenses (e.g., Office 365) can access Business Central data through Microsoft Teams, even if they do not have a Business Central license.

Bridge to Cloud 2 Promotion (Optional)

If you are migrating from Dynamics NAV, Dynamics GP, or Business Central On-Premise, you may be eligible for a 40% discount for three years if you migrate to Business Central Online.

How to Calculate Business Central User Licenses

Calculating the right number of Business Central user licenses is essential for ensuring smooth operations and avoiding unnecessary costs. Here’s a step-by-step guide to help you figure out your licensing requirements.

Step 1: Identify Your Total Staff Count

Start by determining the total number of employees in your organization, including all departments and roles. This count should include everyone who may interact with Business Central, even if their access is limited.

Step 2: Categorize Users Based on License Types

Business Central offers three types of licenses:

Full Users (Essentials / Premium):

These are primary users who perform most of the business processes.

Includes accounting staff, salespeople, project managers, inventory managers, production planners, and service technicians.

Users must either be Essentials or Premium – you cannot mix both in a single environment.

Team Members (Light Users):

Suitable for employees who need limited read and write capabilities.

Can create timesheets, view reports, and make minor updates to records (like customer details).

Often used by executives, managers, outside sales representatives, or employees using Power Apps.

Device Users (Shared Device License):

Intended for shared devices in environments like warehouses, retail, or manufacturing floors.

Multiple users can access the same device for specific tasks, such as barcode scanning or point-of-sale operations.

Step 3: Define User Roles and Functions

Map each user to the license type based on their responsibilities.

Full Users:

Those involved in day-to-day operations, transactions, planning, or administrative tasks.

Team Members:

Users who need to view data, approve tasks, or enter basic information (e.g., timesheets, quotes).

Device Users:

Users who share devices to perform repetitive tasks (e.g., warehouse scanning, production data entry).

Step 4: Count Users for Each License Type

For each department or role, count the number of users who will be using Business Central. Categorize them under:

Full Users:

Essentials or Premium based on required functionalities.

Team Members:

For users with basic viewing and limited interaction needs.

Device Users:

If applicable, count the number of shared devices required.

Step 5: Calculate Monthly Cost

  • Essentials License: $70/user/month
  • Premium License: $100/user/month
  • Team Member License: $8/user/month (approximate)
  • Device License: $40/device/month (approximate)

Step 6: Consider Additional Licenses (Optional)

If using Microsoft Dynamics 365 Sales (CRM) or integrating with other Power Apps, include the cost of attach licenses or additional users required for those services.

Step 7: Factor in Monthly Support & Add-On Costs

Include support costs (e.g., $1000 per month for typical support contracts).

Account for ISV (Integrated Software Vendor) products if needed, such as barcoding software for warehouses.

Step 8: Review & Adjust

After assigning licenses to users, compare your numbers to the total staff count. Make adjustments if necessary to avoid over-licensing or under-licensing.

Step 9: Test & Reassign Licenses If Needed

If you’re unsure about the licensing needs of certain users, start with Team Member licenses and upgrade them to Full licenses if required.

Curious about how AI fits into your ERP? Read the top 16 questions answered on using Microsoft Copilot in Business Central.

Making the Right Choice

If you're planning to move ahead with Dynamics 365, understanding where you stand in the Business Central Essentials vs Premium decision is just the start.

We can help you plan your journey forward—prioritizing what your business needs most and making sure every step adds real value. Get in touch with our Business Central experts today. We'll help you assess your requirements and guide you toward the most suitable plan to maximize your efficiency and drive growth.

Frequently Asked Questions

Dynamics 365 Business Central offers two subscription licensing options: Essentials and Premium. Both are full-use licenses that cover different business needs. Additionally, there are Team Member licenses designed for users who require limited access.
Full users are individuals who require the feature-rich business application functionality provided by Dynamics 365 Business Central. Examples include salespeople, customer service representatives, finance employees, controllers, and supply chain managers.
Team Member licenses are for users who perform light tasks like time or expense entry, HR record updates, or consuming data reports. They are suitable for users who don’t need full system capabilities but still require access to specific areas.
No, you cannot mix Essentials and Premium licenses within the same organization. Users must be licensed under either Essentials or Premium. However, users can switch from Essentials to Premium if needed.
The Essentials license provides features for Financial Management, Sales & Marketing, Inventory & Supply Chain Management, Project Management, and Warehouse Management.
Team Member licenses offer read-only access to most of the system but also permit limited write capabilities, such as approving workflows, editing quotes, and entering timesheets.
Dynamics 365 Business Central is deployed via Microsoft Azure. It integrates with Office 365 and the Power Platform, ensuring strong security and scalability.
No, Business Central is deployed on the Microsoft Azure platform. For specific deployment needs, consult your Microsoft partner.
Yes, not-for-profit pricing is available. Confirm with your provider if you qualify for this pricing along with other discounts.
No, the licensing fee includes the cost of using Microsoft Azure for deployment and hosting.

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Aiswarya Madhu

Aiswarya Madhu

Aiswarya Madhu is an experienced content writer with extensive expertise in Microsoft Dynamics 365 and related Microsoft technologies. With over four years of experience in the technology domain, she has developed a deep understanding of Dynamics 365 applications, licensing, integrations, and their role in driving digital transformation for organizations across industries.

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