Expenses You Can Avoid With SaaS Cost Management
It’s no secret that IT departments face an uphill battle in taking charge of the immediate needs of users as well as the technology needs of the company. Employing SaaS helps ease that burden – in some cases removing the need for compliance departments entirely. With everything in the cloud, revenues increase and the need for time management decreases.
As technology advances, companies are using computer and cloud software to scale their businesses more efficiently and quickly. No matter the size of your firm, understanding your specific business objectives is key to optimizing the SaaS that you chose. SaaS cost management is a practice that every business team should prioritize.
There are many ways that businesses can manage the cost of their SaaS. The first and most important step is to be aware of every dollar that you are spending. There should be no investment in your company – SaaS or otherwise – that is not monitored for its ROI. With visibility comes understanding and an ability to make informed decisions moving forward. Unfortunately, it’s not as simple as throwing it all in an excel spreadsheet (which not only offers a data security risk, but is also overall decentralized and disorganized).
So, what are the best ways to go about SaaS cost management? SaaS management tools like NachoNacho help businesses avoid overpaying on subscription expenses by centralizing and organizing your SaaS platforms. Keep reading to get a closer look at how to optimize your company’s expenses and spending on SaaS.
5 Expenses You Can Avoid by Using SaaS Cost Management
SaaS is an incredibly affordable tool for satisfying business needs while saving your company time and effort. It can be so affordable, in fact, that some firms will make the mistake of not establishing the proper cost-control measures from the start. The benefits of SaaS cost management could amount to millions of dollars in savings. Below are 5 expenses that you can help your company avoid by using a SaaS cost management service.
Duplicate Subscriptions Across Departments
It’s all too easy for an employee to purchase a SaaS product, completely unaware that the company already has an active subscription. In a quickly-expanding company, SaaS procurement likely takes place within departments. The communications team may need a collaboration platform to keep in touch and stay updated with tools to connect team members and customers – and sign up for a SaaS. The sales team may need a lead generation platform to accelerate sales cycles – and sign up for a SaaS. The PR team may need a social media platform to set social channels on cruise control and help create and schedule postings – so they sign up for a SaaS too. These individual teams certainly need to be involved in the purchasing decision-making process, but the actual purchasing needs to be centralized in some way to avoid unnecessary costs. By using SaaS cost management, your business will have the ability to limit redundancy and maximize productivity.
In NachoNacho, a company-wide dashboard shows all of your employees’ subscriptions in one place. Our data from 4,800+ customers suggests that most businesses underestimate the amount of subscriptions they are actually paying for. In many cases, you’ll find that those subscriptions are being recorded in an excel spreadsheet – a recipe for letting costs slip through the cracks. Assigning a separate virtual credit card (we recommend the NachoCard!) per employee per subscription vendor is the best way to stop the slip. This will allow you to have control over every vendor and every employee purchase. Business credit cards are an important tool in tracking and managing your employees’ purchases to prevent fraud and losses. Unlike other options, the NachoCard can be canceled at any time, no questions asked.
One of the most common SaaS mistakes that a company can make is to pay for subscriptions that are not being used. The price of unmanaged SaaS is larger than you might think. A recent study shows that more than 30% of the growing cost of cloud services could go unused in any given month through 2022. Whether your licenses are going unused because of team member turnover or because of misguided scaling assumptions, there is no reason you should be overspending on SaaS.
Your business should only pay for the applications that are essential to running the business. This can be accomplished with SaaS cost management by monitoring usage closely and identifying subscriptions before they become unnecessary. When you come across unused subscriptions, simply cancel or archive them. It’s another reason that SaaS cost management is so important – without centralization, team leaders can be reluctant to cancel a license they think may be going unused. Afterall, who’s to say someone in a different department isn’t using it?
Businesses that migrate their subscriptions to NachoNacho have better visibility and control. On average, users save 25% of their subscription payments by using NachoNacho, measured by the amount of unwanted charges that are being declined either due to limits that are set on a user’s NachoCard or by a lack of need.
Get used to deactivating accounts, identifying inactivity hotspots, and monitoring application consumption – it should become the norm!
Forgotten Free Trials
This is an unfortunately common problem for businesses. And who can blame them? It is too easy to absentmindedly sign up for a platform just to be shocked when the card is charged a month later. Employees may begin free trials which do not generally appear on SaaS vendor reports. Then, when the trial period ends, the SaaS platform begins billing before your company is even aware of the subscription. Used correctly, free trials are a very effective way to test out new services. Done poorly, however, they can become an expensive failure.
A good SaaS cost management platform won’t try and trick you with a free trial. Rather, they will notify you when your trial is almost up and ask you if you are satisfied with their service. The same goes for auto renewals – while some SaaS hope to squeak by monthly billing unnoticed, proper vendor managers will notify companies when their subscription is almost up and ask for feedback to improve their service.
Having a system to manage SaaS is a concept that your firm should take seriously. By using platforms like NachoNacho and tools like the NachoCard, account holders can consolidate and control all of their SaaS subscription expenditures as well as discover and purchase new ones.
Employees Leaving Without Subscription Termination
Picture this: your head of sales leaves. All of their SaaS subscriptions are still open (how many did they have, anyway? 5? 6?). Do you have a clue if they handed over their accounts or passwords before they left? If not, you could be continuing to pay for the subscriptions of people that don’t even work for you anymore.
SaaS cost management would be able to help you stay organized so you’re at the very least aware of what licenses are attached to which employee. This way, when they go, their subscription fees can go with them. With NachoNacho, you can assign one credit card per employee per subscription. You have complete control to cancel one or all of the cards of a given employee in seconds. That means no more overspending on SaaS for ex-employees and personnel.
A SaaS overcharge is anytime you pay more for a subscription that you expected, and this could happen in a few different ways. SaaS vendors can raise their prices or you could be participating in a platform that uses usage-based pricing or premium features. Even if you check your statement and see one dollar more per month than you were expecting, that’s an overcharge! It’s important to know how to avoid overcharges on your SaaS products.
SaaS cost management can help your company understand and negotiate what level of service and product features each department needs to save on spending. While your marketing department may need a higher level of service, your development teams may only need the standard level of service. Cost management practices like tracking SaaS spend, communicating with vendors, and reading the fine print will help you avoid unexpected charges.
Even if you are diligent about following these protocols, there is still a potential to incur overcharges. An excellent strategy to avoid this is by using NachoNacho virtual credit cards. With a NachoCard you can set spending limits and pay for each vendor with a different card. This way, you’ll never experience another overcharge.
Save money when you sign up for SaaS products in NachoNacho’s exclusive marketplace. Save up to 30% a year on your products.
It’s easy to confuse SaaS cost management and SaaS spend management. While they’re similar, the former focuses on keeping track of SaaS subscriptions to avoid unnecessary costs while the latter is about optimizing your spending to most efficiently accomplish your business objectives.
Businesses lose track of their subscription payments over time: there are duplicate subscriptions, unused ones, free trials that unintentionally become paid subscriptions, employees leaving the company without their subscriptions being canceled – not to mention vendors who make it difficult to cancel subscriptions. NachoNacho is a fantastic way to manage and control all of your SaaS subscriptions, saving you time and money.