Negotiating contract renewals for your favorite SaaS tools (like Salesforce) can be stressful. How can you be sure you’re getting the best deal possible? It’s hard to know what to ask for without inside information about how the company does negotiations.
In Sastrify’s new blog series, we’re sharing our top tips for SaaS buyers to optimize your contract during the renewal process. Our advice is based on years of negotiating and procurement experience across our team of experts, so you know they’ll be effective.
(If you’d rather hand the negotiating over to a team of experts so you can focus on what matters in your business, Sastrify is ready to help.)
Today, we’re talking about Salesforce.
Salesforce benefits and alternatives
- Flexibility – Ability to control everything in the platform based on what you need as a user
- Ease of management – Even smaller organizations can easily get trained and manage all necessary admin
- Integrations and APIs – Easily purchase other applications through AppExchange or use APIs to link your other apps
Top tips when renewing your Salesforce subscription
When it’s time to renew your Salesforce contract (or when you’re starting off with the tool), these are our top 5 tips to get the best deal.
1. Get the best discounts at Salesforce’s fiscal year end or end of quarter
Like many companies, Salesforce reps tend to give more discounts as they near the end of their fiscal year (31st January), the end of the school year, or the end of each quarter. Salesforce reps and teams are trying to hit specific numbers at these times, so you’re more likely to get the best discounts on contracts signed close to these dates.
If you are planning a major upgrade of your contract, you should trigger an early renewal and time it towards the fiscal year- or quarter-end to get the best contract terms.
Keep in mind that you’ll get the best discounts by giving them something to work with.
2. Request a larger discount if you meet the requirements
In order to win those discounts, you’ll need to commit to something that makes it worthwhile for Salesforce. Their reps are incentivized for bundled products, multi-year contracts and Success Plans (their guidance and support offering), so you can request a larger discount if any of these apply. Just remember that Salesforce reps are trained in deal management, and the different tactics salesforce reps might use, should be researched and understood before going in.
A quick note on Success Plans: Salesforce will almost always recommend these plans to customers, but the list price premium can be quite steep. If you don’t think you’ll need a plan (or only need it for the first contract term, for example), then you should challenge the rep on it.
3. Get extra discounts for pre-committed and bundled licenses, when negotiating with Salesforce
Planning ahead pays off with Salesforce. Get additional discounts for every license you can pre-commit at signature. If you are growing more gradually, you can ask your sales rep for a “ramp-up” plan to still get the best price possible.
Additionally, you can negotiate each bundled upgrade of 5-10 licenses. With these bundles, you can get a special “growth-license” discount.
4. With Salesforce, you can easily switch out licenses or products as long as the contract value remains the same
Salesforce is heavily triggered by Annual Recurring Revenue, or ARR. This means their primary focus is on ensuring your company is growing in committed spending (contract value).
One interesting aspect of this is that Salesforce is quite accommodating and will allow you to exchange one product for another at renewal. If you have products or licenses that aren’t needed anymore, you can take them out of the contract and replace them as long as the contract value remains the same.
5. Ask for extra free licenses for the team who will be using Salesforce the most
Sometimes, at the end of a tough negotiation, you may be able to get additional free licenses just by asking. It doesn't hurt to ask the question!
Get the best Salesforce contract with Sastrify
All these tips come from the procurement and negotiation experts at Sastrify, who can help you get the best prices on the market for your SaaS licenses. Achieving the best outcome for your SaaS contracts can be a combination of these tips with the right timing and preparation. Sastrify knows best how to approach Salesforce in negotiations to ensure you end up with the best deal terms possible.
Find out how much you can save with our free SaaS savings calculator, and be sure to check back for the rest of our series on things you didn’t know about renewals for popular tools.