Did you know that the majority of businesses are overspending on their SaaS subscription costs? The main reason for this is that they don’t actually know how many services they use and how much the services cost them.
SaaS subscription costs underestimation
You might be thinking that you’re using just Google G Suite, MailChimp, Slack, and a handful of other services. But in reality, your sales team is using half a dozen services, marketing another half a dozen, engineers 10-20, and your CEO has subscribed to several services that you don’t know anything about (except charges that you see on the credit card statements).
If online services are widely used among team members and delivering lots of value to your company, everybody wins. But if you are paying for services just because nobody cared to cancel the subscription, downgrade the plan, or remove non-active members, service providers get easy money while you get nothing in return.
And this is not just, like, our opinion. Over the past year, we’ve conducted dozens and dozens of interviews with people responsible for managing business subscriptions.
At each and every instance it has turned out that people underestimate the number and costs of online services by at least 50%! i.e. Harry's thought they were subscribed to 80 services only when in reality they found over 146 services in their payroll.
How to find your SaaS subscription costs?
The crucial steps to rein in subscription costs of online services is to know what services your company is using and how much they cost you. You can’t control what you don’t know.
To discover SaaS in your business without proper software (this usually comes handy in smaller companies):
- Open Google or Excel spreadsheets,
- Reach out to all of your IT managers, department managers, account owners or even directly to the employees to give you names and costs of all services they are subscribed to.
- Consolidate all of the data you gathered and there you have it.
- Don't forget to remind everyone to notify you of any new SaaS purchases.
- Do a quarterly or annual review, since this is the last thing on their minds.
As you can see this a hard and time-consuming process to finish. Often times employees subscribe to a new tool when they have an issue in their workflow and all the want to do is increase productivity. And let's be honest, leaders like that too.
But knowing this there are often SaaS risks associated by not having complete control and live view of your SaaS stack.
Imagine Mike. Mike has been with the company for 6 years and he just got in charge of their biggest project for the year. For Mike, it's impossible to find enough time in his day to finish all the tasks required.
The company uses a project management tool but he never got fond of it. Then one day he received a new Facebook ad for a different project management tool that speaks directly to him with all the pain points he has. So he decides to subscribe to the new tool with the corporate credit card.
There is also Phil that just joined the company a few days ago after working in a similar company for a few years where they used OneDrive throughout the whole time. He is working really hard on the same project as Mike when he is notified he needs to use DropBox. His days are full so he doesn't have time to figure out the new storage system, therefore he uses his old one instead.
Do you see how these two scenarios connect back to tracking your SaaS subscriptions in a spreadsheet? It is just impossible to follow. Employees change fast, SaaS tools that increase productivity are growing every day at the same time when you need to take care of security gaps and staying compliant.
Besides going through this hard time, just think about all of the free-trials, and shadow IT they subscribed to in the past but is now just sitting there going through any of your corporate accounts and credit cards. These will never be uncovered if you are using spreadsheets. As shown previously, up to 30% of SaaS spend is wasted annually.
There is one different way to tackle this. Faster, automatic, and it pays for itself.
Subscription management software
To help you out Cleanshelf has developed an easy-to-use enterprise saas management platform to quickly compile a list of services you use and estimate their costs.
In 30 minutes or less, you should gain a much better understanding of your subscription costs - the first step towards reducing overspend currently associated with online services in most companies. Additionally, calculating your SaaS TCO will become much easier.
Cleanshelf is on a mission to promote the efficient use of online services. We offer a premium service that helps companies not just take back control of online services but stay in control without wasting your precious time and resources handling services’ red tape.
Ready to discover your enterprise SaaS costs?
Cleanshelf is the leading enterprise SaaS management platform focused on tracking, controlling, and benchmarking SaaS applications. Their SOC 2-compliant and AI-powered technology helps companies save up to 30% on their SaaS spending by automatically identifying unmanaged contracts, duplicate licenses, and wasted cloud software subscriptions. Based in San Francisco, Cleanshelf provides an enterprise-grade solution to over a hundred clients, including Qumulo, Wodify, and CoStar Group.