Negotiate your SaaS renewals in pounds, not percentages

This summer, a UK B2B SaaS business I worked with faced a CRM renewal with a fixed deadline and no extension. The vendor offered several packages, each framed around protecting the discount percentage. Every one of them cost more than the current contract.

What the contract was paying for

I went through the renewal line by line against live CRM data. Three-quarters of the billable marketing contacts were records of organisations the business never sold to. Of 14 paid seats, 5 belonged to people who owned deals. The database sat about 200 contacts below the next price tier and was adding around 19 a day.

Moving the decision to pounds

A bigger discount on a bigger package is still a bigger bill. My recommendation was to reclassify the non-buyer records as non-marketing contacts, with nothing deleted, which would keep the account well under the next tier. Seats would come down to the people who use them. The negotiation would then run on total contract value.

Handing over the negotiation

I wasn’t going to be on the call, so I gave the COO a 22-point confirmation list to take into it. Each point was a number to check or a term to confirm before signing.

Before your next SaaS renewal

Export your usage before the vendor’s first call. Count the seats with activity in the last 90 days and the contacts that match your ICP. Then ask for every option as a total annual cost and compare those totals with what you pay today.

Related: how to price your own SaaS to protect renewal leverage, or read the case studies.