Understanding SaaS procurement strategies

The software-as-a-service (SaaS) market is rapidly growing, with organisations of all sizes adopting SaaS solutions to help them run their businesses more efficiently. While the benefits of SaaS are numerous, there are also some challenges associated with procuring and managing SaaS contracts. In this blog post, we’ll review some of the key considerations for developing a successful SaaS procurement strategy. We’ll also provide some tips on how to negotiate favourable terms with vendors and manage your SaaS contracts effectively.

Define what SaaS is and how it can benefit your business

SaaS provides businesses with an alternative to traditional, one-time software purchase models. Instead of installing applications onto your local server or device, the SaaS model allows users to access high-quality applications and services through the cloud. This provides businesses with immense cost-saving opportunities due to its subscription-based pricing model and reduced maintenance requirements. Furthermore, providers keep their services updated with the latest security protocols, keeping customer data safe, secure, and easy to access all in one place. With SaaS procurement strategies and integrations available for your business needs, you can enjoy improved scalability, agility, reliability and stronger ROI potentially.

Understand the three main types of SaaS procurement strategies

SaaS is a tremendous resource for companies looking to streamline their operations, understanding the best strategies for implementing can be daunting. There are three main types of SaaS procurement strategies to contemplate: subscription packages, build-to-order, and fixed-fee models.

Subscription packages

Subscription packages are the most common form of SaaS procurement, enabling organisations to pay a monthly fee for access to a certain suite of services. This is beneficial for businesses that need access to multiple applications and services, such as productivity tools or web hosting solutions.


The build-to-order model allows organisations to specify the exact services they need, and then purchase those services in a single package. This is beneficial for businesses that only want to pay for what they use, as well as those that need custom solutions tailored specifically to their needs.


Finally, fixed-fee models enable organisations to lock in long-term contracts at predetermined rates. This model is advantageous for businesses that can predict their SaaS usage over long periods. It also gives them the peace of mind of knowing that if services are discontinued or prices change dramatically during the contract period, they won’t be affected by these changes.

No matter which strategy you choose, understanding these options can help your business get the most out of SaaS and make your processes much smoother.

Learn about the benefits and drawbacks of each strategy

When it comes to selecting a SaaS procurement strategy, one must weigh the benefits and drawbacks of each approach. Direct purchasing, equity investments, licensing and subscription models are the most common methods for procuring SaaS solutions. Direct purchasing may be more convenient for organisations facing tight budget constraints as it provides an upfront payment commitment; however, brands can face rising costs due to technology changes or contracts being renewed at higher rates. Equity investments provide organisations with more insight into the inner workings of their product but can require considerable investments to prove profitable. Licensing models allow companies to customise products while avoiding long-term commitments associated with other strategies; however, they may become complicated due to the number of different players involved. Finally, subscriptions offer users access to immediate updates and technical support but lack the portability features associated with licences. By taking time to carefully consider the benefits and drawbacks of each SaaS procurement strategy, companies can make an educated decision that involves the least risk and yields the maximum reward.

Choose the best SaaS procurement strategy for your business needs

When it comes to choosing the ideal SaaS procurement strategy for a business’s needs, no ‘one size fits all’ approach suits everyone – every business has its specific requirements and budgets that need to be taken into account. While one company might benefit from a subscription model which provides lower upfront costs, another may gain more from a pay-as-you-go approach. Researching the different options available is key as this will help identify what type of SaaS procurement strategy will give the best return on investment in terms of cost savings and performance for that particular organisation. Businesses should keep their options open and ensure they can make informed decisions when selecting the best SaaS procurement strategy for their current needs.

Negotiate favourable terms with your vendors

Once you’ve determined the best SaaS procurement strategy for your business, it’s time to start negotiating with vendors. Make sure you do plenty of research and reach out to multiple providers to get the best deal. When talking to potential vendors, be as specific as possible about what services you need and how much you’re willing to pay. Be aware of any hidden fees or additional costs that may not have been mentioned during negotiations. Also, don’t be afraid to ask for discounts or special offers if a vendor is unable or unwilling to offer them initially.

Manage Your SaaS Contracts

Once you’ve negotiated a satisfactory agreement with a vendor, it’s time to start managing your SaaS contract. Establish a clear timeline for the duration of the agreement and make sure that all parties are aware of it. Track usage and performance metrics regularly to ensure that you’re getting the most out of your SaaS investment. Also, keep an eye on any changes or updates in vendor policies or terms of service so you can respond accordingly. Finally, don’t be afraid to renegotiate if you feel like your current contract is not meeting your needs.

Having a detailed knowledge of the available SaaS procurement strategies is essential to making informed decisions when it comes to investing in cloud-based applications and services. Companies should consider all the factors involved in each strategy and carefully weigh the benefits and drawbacks of each to identify which is best suited for their specific needs. Negotiating favourable terms with vendors and managing contracts effectively are also important steps that can help businesses make the most of their SaaS investments. By taking all these steps into account, companies can ensure they’re getting the most out of their SaaS investments while still minimising risk and maximising reward.

Appstrato can help your organisation with SaaS procurement.

We provide an end-to-end solution that helps you find the right SaaS products, negotiate contracts and manage them efficiently. Our platform can help you compare different vendors and subscription models to determine which is best suited to your needs. We also offer a secure cloud platform to store all of your contracts, giving you complete control over your SaaS investments. Finally, our powerful analytics and reporting tools can help you track usage and performance metrics, enabling you to make informed decisions about your SaaS investments.

By leveraging Appstrato’s expertise and technology, businesses can ensure that they’re getting the most out of their SaaS investments while still minimising risk and maximising reward. Contact us today to learn more about how we can help you with your SaaS procurement needs.

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