Software renewals: The smart checklist every business needs

Every IT professional knows the feeling: the looming deadline of the fiscal year, and the inevitable question of software renewal. 

Just like a well-worn car that needs a tune-up, your software systems need regular updates to keep chugging along. But these days, software renewal isn’t just about maintenance; it’s a strategic decision that can make or break your organization’s digital performance.

What is software license renewal?

A software renewal is the recurring process of extending or updating the license, subscription, or maintenance agreement for software solutions. It allows organizations to continue using a solution, post its initial licensing period.

Software renewal season doesn’t have to be a headache. With tools like BetterCloud and a solid checklist, you can streamline the process and reap additional benefits beyond simply renewing your licenses.

How to prepare for software license renewal

The first step to saving on software renewals is to actually prepare for said software renewal. (You’ve taken this crucial first step!)

With automatic renewals a thing, it’s important to remember data is a key component in the software renewal process. What data exactly? Two major pieces of data: Software usage and industry benchmarking.

Measuring software usage

Historically the process of obtaining software usage has been begrudgingly manual or near impossible as not every application shares these metrics that IT and Finance can actually act on. Now thanks to spend management software (like BetterCloud’s spend optimization module) IT has it easy.

Industry benchmarks that actually help

As for industry benchmarking, this has been a longtime looming question. Are we paying more than others in our same industry and size? 

Enter BetterRenewal. Leveraging our $35B+ contract database, BetterCloud is able to deliver you the exact insights you need when entering the negotiation process. 

Deciding on your software renewal path

Outside of getting the right data, you’ll want to assess the current licensing needs and allotted budget across departments. 

Once you have all your I’s dotted and t’s crossed, you’ll have a couple of options going forward with a license renewal:

1. End agreement: If you realize the software you are using isn’t all that, you can make the decision to switch at the end of the lifecycle. 

2. Renew and negotiate: If you find that some of the identified disadvantages are fixable, renew the agreement but ask to negotiate a couple of terms. You can leverage the potential loss of business for a better software contract.

3. Renew agreement: If you’ve come to the conclusion that you are satisfied with the software solution and want to move forward as is, renew it. While it might be tempting to continue to renew year after year without revisiting the checklist above, it is not a good step to skip. Your business needs can change over time, possibly demanding new software features or even new products. 

Software renewal checklist

Automating your tech stack before its renewal date can save time, and it’s a great method for keeping track of your current spending and annual maintenance, but you might be overlooking some opportunities to find places to save and negotiate new deals with your suppliers. 

Before renewing your current software license agreement, pay attention to the following factors. 

Usage: Consider what you are currently paying for and how much the software is actually being used. The results might bring up an opportunity to switch up the payment model and save on your software spend before reaching any expiration dates. 

Upgrades: Take a look at your history with this particular product. If you have been looking for a new feature, check out what the upgrade options have to offer. If you are happy with the version you’ve been working with, there is no need to upgrade. 

Support: Look at the records of your interactions with the technical support team. If you haven’t been using their services very often, maybe downgrade to a cheaper software maintenance option.

Purchase history: Check out how your business has been buying the software. If you have been making recurring payments that are harsher on the business bank account, consider switching to a lump sum that will end up saving you some money in the long run. 

Contract: Re-read your software contract and ensure there are no risks associated with signing on the bottom line. 

Pricing: Compare similar SaaS tools and their software licensing prices. If a competitor is offering the same features and support for the same price, consider making a switch. 

Negotiation: Once you’ve decided you want to renew, make sure to prepare for contract negotiations well. Consider bringing up things like past issues with customer support, pricing competitiveness, change in user count, upgrading your tier, etc.

How BetterCloud supports software renewal management

Keep up to speed on your software spend, contract renewal deadlines and compliance with BetterCloud. This SaaS system of record equips you with the knowledge you need to choose what’s best for your business. 

• Centralized software inventory: BetterCloud offers a centralized repository to manage your organization’s software inventory. This includes details on each software application, its usage, and renewal information.
• Renewal notifications: The platform offers renewal notifications and alerts, helping you stay informed about upcoming software renewal dates. This approach helps prevent unintentional lapses in your software subscriptions.
• Vendor relationship management: BetterCloud improves vendor management by centralizing vendor communication and information. This is valuable when negotiating renewal terms or discussing contract changes.
• Compliance monitoring: Ensuring compliance with software licenses is crucial. BetterCloud allows you to monitor software usage against licensing agreements, helping avoid compliance issues during the renewal process.

To renew or not to renew

That is the question. And it is not necessarily an easy one to answer.

As your business develops, the software products and features you need to succeed might change as well. While it may not seem as if you need to switch things up, evaluating your current situation and alternatives is a good practice to partake in every time software renewal season comes around.

Let BetterCloud show you the data you need to confidently make all decisions regarding software. Request a demo to see more of what BetterCloud can do for your company.