SaaS spend management: How to optimize your SaaS spend

Whether you use a business software like NetSuite to manage business finances and customer relations, or Adobe Creative Cloud for graphic designing, web development, etc., cloud-based subscription software has now become the backbone of the business world.


While using SaaS (Software as a Service) applications is a great replacement for clunky software products that take up a lot of storage space and require loads of time for installation, managing SaaS-based spending is a different issue altogether. 

What is SaaS spend management?

As businesses bloom thanks to the nifty features provided by various subscription-based software, we are also seeing overuse of software with overlapping functionalities, causing many companies to spend more and reap lesser benefits. That’s where SaaS spend management comes in. By overseeing and controlling how you spend your money across different subscriptions, you can optimize your overall SaaS costs and boost savings.


You can do this by narrowing down SaaS applications that serve your business purpose the most, selecting the right value of licenses for the best value, and ensuring that no unnecessary subscription renewals are done.

saas spend management

Excessive SaaS spending

Before we talk about the methods you can adopt to control your SaaS spending, we must look at how companies oversubscribe and overspend on too many SaaS applications.

Licenses that have not been discontinued

If an employee leaves your company and you haven’t revoked their license, then you are paying additional dollars from your pockets unnecessarily. Especially if your IT department is not aware of these duplicate shadow apps, your monthly bill for these SaaS spend is going to be sky-high!

Duplicate apps

Since there is no single platform for SaaS management, departments end up paying for different apps that ultimately serve the same purpose. Whether it’s using Google Drive & Dropbox, or Slack, subscriptions for all these different applications solving the same problem can set your company back a couple of hundred dollars every year.

Off-the-shelf pricing and unoptimized licenses

Most SaaS companies offer lucrative pricing models to other companies and big enterprises. Since the usage of their software would be higher in a business than by a single user, SaaS companies offer their services at a lesser price to businesses than individual users. This is a great deal, however, if your employee is choosing the individual plan on their own, this could result in you paying more for a license that could’ve been bought for less.

Forgotten cancellations

Sometimes the applications are not accounted for as we forget to tell our IT team or accounting department about them, leading to them getting renewed without our knowledge. Another problem is that most of these SaaS applications come with auto-renewal mode turned on, so you manually have to switch it off. Overlooking this crucial step with just a handful of programs can cost you hundreds of dollars worth of needless spending every month.

Why your organization needs SaaS optimization?

Unmanaged spending in any area of your enterprise can wreak havoc on your cash flow. Considering how vital and indispensable SaaS applications have become for day-to-day operations, SaaS optimization is important to spend company capital smartly.

To eliminate wasteful SaaS spending

You can rescue your debilitating SaaS budget by eliminating similar or duplicate applications. You must go through your inventory and figure out any SaaS application that is underutilized yet leeching off money from your business. These apps bring no value to your organization and are mostly subscribed by employees who use them for a while but move on to other apps without informing the IT department promptly.

To save company time during compliance

It’s not just your business’s money that’s precious, it’s also the company’s time. When you do not have a SaaS spend management in place that gives you a consolidated list of all the apps currently being used in and paid for by the company, you will have a lot of trouble explaining the “mysterious” expenses during auditing. You will have to resort to wading through endless credit card statements and departmental heads and managers but then again who has time?

To curb employees’ spending

Without an optimized SaaS spend management in place, you are essentially putting the purchasing power into the hands of your employees. With that, they can purchase SaaS applications that suit them best, not the ones that are standardized by your IT department. For example, if every department uses a different communication tool and pays for its annual or monthly package, that could rack up a huge bill for your company. These kinds of overlapping SaaS applications and shadow apps must be curbed at all costs.

Looking for the best subscription management software for your business?

6 ways to optimize SaaS spending


Determine which applications will be prioritized

Instead of going through every single SaaS application and reviewing its relevance which is in itself a time-consuming task, try to prioritize in a more streamlined manner. One of the ways could be to target the top 10 most expensive SaaS applications used or aim for applications with approaching renewal dates to save yourself from yet another wasteful spend.

Gather all relevant data for each application that has to be optimized

Without doing a proper cost-benefit analysis and gathering all spending information, it would be extremely difficult to ascertain an optimization strategy that significantly reduces SaaS costs. One way to gather it would be to go through user agreement and purchase information of the SaaS application that contains insightful information such as license quantity, features, along with any additional licenses and services purchased thereafter.


Another way to ascertain SaaS spending would be to use a spend management platform like Volopay with a transparent accounts payable tracking system so that you can know accurately who bought the said SaaS application along with the renewal history.

Take look at your team’s usage of SaaS applications

SaaS spending is considered wasteful not only when too many applications are utilized, but also when a particular subscription is underutilized.


Some ways you can collect data and optimize a specific SaaS application would be by calculating its total users, analyzing the daily and monthly login rate, cutting costs by removing paid premium features from employee accounts that do not need them, and observing application generated metrics to accurately gauge threshold within a specific app.

Find cost-cutting opportunities

By using a SaaS spend manager, you can quickly identify areas that could benefit from cost-cutting opportunities. You can reduce inactive users on a specific SaaS application by eliminating unused licenses, especially in apps that charge on a per-user basis.


Another way would be to remove paid premium features from unnecessary employee accounts as we mentioned in the last point. Finally, you can also save a lot of money by revoking licenses of attritted users who might be leaving the company soon. You can either pass these licenses on to incoming or existing users instead of buying new ones.

Consolidate unnecessary SaaS licenses

One of the many benefits of having a SaaS management platform is the ability to identify and consolidate any unnecessary SaaS licenses that exist to further bring the cost down.


You can eliminate redundant functionality by eliminating duplicate applications that serve a similar purpose. This can streamline spending and bring down any communication problems between departments due to similar SaaS tools.

Review your SaaS spending regularly

If left unchecked, your SaaS spending can drain money from your business aggressively. That’s why it is prudent to ensure that you review your SaaS spending regularly to keep a strict rein over your employees’ subscription habits and be able to stay up-to-date on any changes vis-a-vis subscription costs and user analytics.


Of course, all of these optimization tactics can reap their full benefits with a solid SaaS subscription management system in place. Volopay can help you achieve great SaaS cost savings and optimization with its 5-in-1 spend management features.

Manage SaaS spend with platform that truly works for you

Volopay is a one-of-its-kind spend management platform that allows you to manage your SaaS spending and effectively identify cost-saving opportunities. With Volopay, you can streamline your SaaS subscriptions on a centrally located expense management platform with 100% transparency regarding who purchased the subscription and who approved it.


Enjoy Volopay as your complete financial stack, equipped with the innovative tools you need to manage and optimize your SaaS spend.

Assign vendor specific cards

All your vendors are listed clearly, so you never have to pay for any unnecessary subscription ever again. Not only that, you can save yourself from any late fees by setting up reminders to collect invoices on time.


To keep costs manageable, use our virtual cards that come with one-time and recurring modes so you can track, pause and cancel any subscription as you please. Unused, wasteful licenses have no place at Volopay – you can simply change cardholders without canceling subscriptions.

reconcile payments

Create one-time burner cards

If you are keen on trying a new SaaS tool but afraid to miss out on the expiry date, Volopay lets you create burner cards with the expiry date on them so you can get the reminder to end your trial before your subscription payment goes through.

virtual cards

Sync with your accounting software

Seamlessly sync all your SaaS subscriptions onto your existing accounting software - Netsuite, Quickbooks, Xero, Deskera, MYOB, Zoho, and Tally - with Volopay’s automated accounting feature and stay ready for any surprise audits that may come your way.

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