The Hidden Costs of Unmanaged SaaS Subscriptions

SaaS tools are everywhere, whether you are a small startup or a multinational organization. Organizations prefer SaaS apps because of their ease of deployment and flexibility. While these SaaS platforms are convenient to use, they can cause hidden costs due to unmanaged SaaS subscriptions.

At CloudFuze, we offer SaaS management software that identifies & eliminates unused SaaS licenses to reduce hidden costs.

In this blog post, you’ll explore what hidden costs are, how they affect your business, and how CloudFuze Manage tackles them.

What Are Hidden Costs?

Hidden costs are unnoticed extra expenses associated with your SaaS usage across departments. These costs usually arise when there’s no proper oversight for managing SaaS apps. The hidden costs are mainly due to the following reasons:

• Your teams might subscribe to similar tools without realizing others already use one, leading to duplicate spending.
• If you’ve enabled auto-renewal, subscriptions can renew by default, even when the tool no longer serves your business needs.
• You may continue paying for licenses tied to former employees or unused apps, wasting money on inactive accounts.
• When employees sign up for tools without involving IT, they bypass security checks and procurement policies. This shadow IT exposes your organization to data leaks & security risks.

The Impact of Hidden Costs in Unmanaged SaaS Subscriptions

When your SaaS subscriptions are left unmanaged, the hidden costs silently add up, leading to other challenges, such as:

Rising SaaS Expenditures

You may find that subscription fees for an individual may seem minor, but when multiplied across departments & billing cycles, they become a financial burden. When there is no transparency on the usage of your SaaS tools, these expenses can cause budget bloat and reduce capital available for other necessities.

Compliance & Security Exposure

When you subscribe to an app without IT oversight, you’ll face risks with industry regulations like SOC 2 Type 2 or GDPR, which can lead to legal penalties and brand reputational damage.

Decreased Efficiency

The use of redundant/overlapping tools can disrupt business workflows, complicate the employee onboarding and training process, and overburden IT teams with unnecessary support responsibilities.

Zero Visibility on Insights

Without a clear view of all your SaaS apps, stakeholders lack important insights needed to manage costs that align with company goals.

5 Best Practices to Avoid Hidden Costs of Unmanaged SaaS Subscriptions

Unmanaged SaaS subscriptions can quietly drain your software budget. You have to take the necessary steps to control them. Here are the best practices to help you avoid hidden costs:

1. Conduct SaaS Audits

Make sure to review your SaaS inventory regularly. Evaluate usage, license counts, and spending across departments. Also, identify underutilized tools and cancel or reassign them wherever possible.

2. Always Maintain a Common SaaS Procurement

Create a standard SaaS purchasing policy. Strictly make sure that all new subscriptions go through IT or procurement to avoid duplication and SaaS-related security risks.

3. Utilize an Efficient SaaS Management Software

You can use a SaaS management platform like CloudFuze Manage to assess license usage and reassign or cancel licenses that are underutilized.

4. Renewal Alert Triggers

Set calendar reminders to alert you before subscription renewals. This gives your team time to evaluate the value of each tool and make informed decisions.

5. Finally, Train and Align your Teams

You must ensure that your employees understand the process for requesting new tools, which can greatly reduce SaaS sprawl. Also, train your employees on approved platforms to promote adoption and eliminate reliance on unapproved solutions.

How CloudFuze Manage Helps Organizations Eliminate Hidden Costs

Our SaaS subscription management software is built to help businesses like yours simplify your SaaS Ops & cut unnecessary expenses. Here’s how you can do it:

• Connect and automatically detect 50+ major SaaS apps across your company, including unsanctioned tools.
  
• You can analyse usage data and reassess license allocations by identifying unused or duplicate tools.
  
• With our SaaS management app, you get alerts for auto-renewals to prevent unnecessary extensions.
  
• You can also identify overlapping tools, making vendor negotiations easier & saving costs.
  
• Also, you can manage your workflows easily with our SaaS management platform.
  

Maximize Your SaaS ROI with CloudFuze Manage

SaaS has transformed the way your business operates in this digital era. However, unmanaged SaaS subscriptions can lead to wasted budgets and security threats. By auditing your tools, standardizing software purchase, monitoring license usage, and using tools like CloudFuze Manage, you can govern your SaaS spectrum.

At CloudFuze, we have a SaaS management solution that helps you monitor all your SaaS apps and cut hidden costs associated with unmanaged SaaS subscriptions.

Contact us for a free demo today!

FAQs

1. How can I tell if my company has unmanaged SaaS subscriptions?

You can discover unmanaged SaaS subscriptions by checking for duplicate tools, unused licenses, or apps without IT approval. Our SaaS management platform gives you a 360-degree view of your company’s SaaS tools and helps you find unmanaged software easily.

2. What is SaaS sprawl?

SaaS sprawl occurs when different departments use SaaS tools independently, leading to overlapping and increased costs. With CloudFuze Manage, you can gain total visibility of your SaaS apps, even the unsanctioned ones, and prevent sprawl before it impacts your budget.

3. Does CloudFuze Manage have a renewal alert option?

Yes, CloudFuze Manage includes a renewal alert feature that notifies you before subscription renewals. This helps you optimize your SaaS spend and gives you time to reassess or cancel unused SaaS tools.