How to Improve Your SaaS Renewal Strategy?

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Are you struggling to handle multiple SaaS renewals using spreadsheets? Is it challenging to control your SaaS spending due to auto-renewals? It might be hard for you to manage SaaS renewals if you still rely on old-fashioned methods.

Without an efficient SaaS subscription renewal system in place, your organization might face,

• Financial losses from missed deadlines result in unnecessary spending on reactivation fees or higher subscription rates.
• Failure to renew SaaS licenses promptly can disrupt business operations and cause productivity loss.
• Expired licenses may leave the organization vulnerable to cyber threats due to a lack of critical security updates and patches.
• Inadequate tracking of SaaS licenses may lead to non-compliance with contractual obligations, posing legal and regulatory risks.
• You may miss opportunities to optimize your organization's SaaS portfolio and negotiate better terms without a structured SaaS contract renewal management process.

To mitigate these issues, you can use industry-proven strategies and best practices to enhance SaaS renewal management and stay ahead of the curve.

Keep reading to identify and enable SaaS renewal strategies for your organization.

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What is a SaaS renewal?

SaaS contract renewal is the process of extending or reactivating SaaS contracts. When a SaaS contract term expires, you need to renew their licenses to maintain access to the software and its associated services.

It involves paying the licensing fee for the upcoming period to maintain access to the software and its features. If you don't renew, you might lose access to the software, disrupting your work and productivity.

SaaS renewals are periodic. An organization uses 300 SaaS tools on average, so you must keep track of them efficiently to avoid application downtimes or auto-renewals. Read on to learn more about improving your SaaS renewal strategy.

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7 Ways to improve your SaaS renewal strategy

Optimize your SaaS renewal management strategy with the following actionable steps to get the best value for your SaaS subscriptions and keep costs in check.

1. Analyze your current strategy (Challenges and pitfalls)

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To create a robust SaaS renewal strategy, analyze your current approach. Look closely at what's working well and where improvements are needed.

You might face challenges like unclear renewal terms, difficulty tracking usage, and poor vendor communication.

These issues can slow the renewal process and prevent you from getting the best results. Your current process might include spreadsheets to keep track of renewals, which should be replaced using a sophisticated renewal management system.

So, you should carefully evaluate your current strategy to identify areas that need attention. After the analysis, come up with solutions to make things better.

2. Assess current usage and future requirements

To effectively improve renewals, assess your current resources, usage and anticipate future requirements. Conduct a comprehensive analysis of your existing SaaS license usage patterns.

This analysis will reveal how teams utilize the application and the number of licenses. You can develop a strategic plan for renegotiating license renewals by understanding usage patterns.

• If usage is low, consider reducing the number of licenses during renewals.
• Conversely, you may need additional licenses to meet demand if usage is high.

This proactive approach ensures your organization optimizes its SaaS investments while aligning licensing with usage needs.

Adopting this forward-thinking approach ensures that your SaaS application management and license usage align with your organization's evolving needs.

3. Prepare a renegotiation plan (don’t wait till last minute)

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Prepare a renegotiation plan with careful consideration and proactive analysis. When you have the SaaS license usage patterns, you can negotiate more effectively in the next renewal phase. It typically entails renegotiating subscription terms, such as pricing, usage limits, and additional features or services.

You must not wait until the last minute to initiate contract renegotiations. Instead, begin the process early to allow sufficient time for thorough preparation and negotiation.

Here's how you can improve your renegotiation plan:

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4. Analyze vendor performance during the previous contract period

You should not forget to analyze your vendor's performance during the previous contract period.

If the vendor fails to address your inquiries or the application promptly encounters compliance or integration issues without adequate vendor support, you can terminate the contract instead of renewing it.

However, evaluating the vendor's performance is the only way to discern this.

Analyzing vendor performance with key metrics thoroughly provides insights into reliability, support quality, and innovation commitment. This historical data will help you make informed decisions during renegotiations.

You need to assess how effectively your SaaS vendors have delivered on their promises and maintain open communication with them. Also, you must consider their uptime, customer support responsiveness, and the timeliness of updates or feature releases.

• Firstly, uptime measures the vendor's ability to maintain system availability, which is crucial for minimizing disruptions to business operations. Reviewing historical data helps gauge reliability and ensure minimal downtime.
• Secondly, evaluating the responsiveness of the vendor's customer support team is vital. Assess how promptly and effectively they address issues and resolve queries to ensure a positive user experience.
• Lastly, consider the timeliness of updates or feature releases. Regular updates indicate a commitment to improving the product and meeting customer needs. Evaluate if updates align with organizational requirements.

5. Keep your BATNAs and price benchmarks ready

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You must keep your BATNAs (best alternative to a negotiated agreement) and price benchmarks ready for an effective SaaS renewal negotiation.

BATNA serves as your backup plan in case your license renewal negotiations fail. By knowing your BATNA, you can confidently negotiate licensing costs, knowing you have options if the current agreement doesn't meet your needs.

Considering alternative vendors or solutions gives you an advantage to leverage during renewal negotiations. You can instill FOMO in vendors by using your BATNA efficiently. No vendor would like to lose a paying customer like you. This can help you negotiate a sweet deal with the vendor.

You can negotiate more effectively by knowing what similar vendors offer and the market rate for the SaaS license you seek to renew. It will give you leverage and prevent you from accepting unfavorable terms out of desperation.

6. Use a SaaS management platform to track applications and renewals

You should not only focus on SaaS renewal but also on automating the process. Traditional SaaS app management has many disadvantages, which ultimately reduce organizational efficiency.

For instance,

• Managing hundreds of SaaS contracts with spreadsheets is time-consuming and error-prone.
• It poses a risk of sensitive documents getting lost and causing privacy breaches and security concerns.
• Manual contract tracking leads to limited visibility and missed renewal dates.
• Auto-renewals often lead to missed negotiation opportunities and excessive costs.
• The absence of a centralized system and reliance on manual processes hinder collaboration, waste time, and result in inefficiencies.

Thus, there arises a need for an alternative approach. Automating SaaS renewal processes through workflow automation tools saves time and minimizes the risk of missed deadlines.

With these tools, you can configure workflows to send renewal reminders, initiate contract reviews, and prepare negotiation plans based on predefined criteria.

Automating SaaS renewals using workflows

Automating SaaS renewals using a SaaS management platform brings the mentioned benefits to the organization.

• Streamlined Tracking: SaaS management platforms offer real-time visibility into application usage, aiding in identifying underutilized tools.
• Efficient License Management: Automated provisioning and tracking of licenses ensure optimal allocation and compliance, minimizing costs.
• Automated Renewals: With automated workflows and reminders, platforms facilitate timely contract renewals, preventing service disruptions.
• Data-Driven Decisions: Insights into application utilization enable informed decisions on which licenses to renew or cancel, optimizing the software portfolio.
• Improved Efficiency: These platforms enhance operational efficiency and vendor relationship management by centralizing SaaS management tasks.

You can utilize CloudEagle, a comprehensive SaaS management and procurement platform, that is equipped with a dynamic contract management module, to optimize your SaaS renewal process.

Here's how CloudEagle can enhance your SaaS renewal process:

Seamless Integrations: CloudEagle boasts extensive integration capabilities, featuring over 300 direct integrations with popular SaaS applications, including Single Sign-On (SSO), finance, HRIS, and direct API integration.

This broad spectrum of integrations allows CloudEagle to provide complete visibility into your SaaS stack, even identifying applications procured without IT approval.

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Usage Insights: Through system integrations, such as SSO, finance, and HRIS, CloudEagle furnishes a comprehensive overview of your SaaS stack, including spending and user metrics.

Direct integrations check into each application, offering granular usage data from purchase to present and insights into license provisioning.

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Centralized Management: CloudEagle aggregates all application, user, and usage data in one centralized location.

It eliminates the need to navigate multiple platforms for information retrieval. With insights into license usage and application performance, you can make informed decisions regarding renewals.

Contract Management: CloudEagle facilitates streamlined contract management. It extracts and organizes contracts and sensitive documents from applications into a centralized repository.

Even if your team uses spreadsheets for contract tracking, CloudEagle can seamlessly integrate this data, automating the extraction process for renewal-related details.

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Renewal Calendar and Workflows: CloudEagle generates a renewal calendar based on contract dates, enabling you to track upcoming renewals efficiently.

Workflows will be triggered 90 days in advance, sending renewal reminders to relevant stakeholders. You can analyze the usage, collaborate with the team, and renew the contract or right-size unused licenses through negotiations.

CloudEagle sets itself apart by continuously escalating renewal processes to relevant stakeholders until contracts are successfully renewed.

Through automated Slack, email, and in-app notifications, CloudEagle ensures persistent engagement until renewal completion, fostering collaboration and timely decision-making.

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You can boost the SaaS renewal efficiency with Slack integration. Tracking renewals for hundreds of SaaS apps is a daunting task. There is the risk of missing out on SaaS contract renewal deadlines and suffering service disruptions

CloudEagle’s Slackbot will enable you to manage renewals from the messaging app without visiting our platform.

You’ll receive notifications on whether to stop or renew the license, and you can approve or deny the request from Slack. Additionally, you can create a private Slack channel to communicate with relevant stakeholders and make the right renewal decisions.

7. Seek expert negotiation assistance

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To cut costs, negotiate with the vendor to align your SaaS licenses with application usage, thus effectively reducing your SaaS costs. While vendors may attempt to persuade you to upsell their product, you should assertively maintain your position. Avoid being swayed by these tactics; renegotiate your contract efficiently to downsize it.

If your procurement team lacks time and bandwidth, you can seek help from our SaaS negotiation experts. The experts will work closely with your team to understand the contracts and requirements and negotiate accordingly. They will help you confidently navigate negotiations, ensuring you get the best deal possible.

CloudEagle's experts have years of negotiation experience. They will conduct market research, leverage price benchmarks, and negotiate the best deals for you.

Ultimately, bringing in expert negotiators from CoudEagle will save you time, money, and stress while ensuring you get the most value for your SaaS investments.

An example of CloudEagle's success is seen with Sophie Wang's finance team at Wefunder, who achieved significant savings with their assistance.

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Conclusion

Opting for an advanced solution to streamline SaaS license renewal in your organization? Look no further than CloudEagle. You can automate and optimize SaaS renewal processes, reducing the risks associated with manual tracking and inefficiency, with CloudEagle's contract renewal management solution.

With CloudEagle's user-friendly renewal management module, you can ensure timely renewals, minimize financial losses, enhance security measures, and increase user satisfaction within your organization.

The tool provides access to the latest price benchmarking data from previous transactions and thorough market research, helping businesses get the best deals from the vendors.

So, if you want to enhance your organization's operational efficiency by streamlining the SaaS contract renewal process, you should opt for the right tool and leverage its capabilities. It will help you transform how your organization keeps track of and manages SaaS licenses.

So, book a demo with CloudEagle to optimize SaaS license renewal strategies and enhance your organization's efficiency.

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