How to reduce Salesforce licensing cost


Salesforce is the most popular CRM across the globe and its been highly appreciated among the large enterprises. But for mid and small level organizations, it’s a tough choice due to its complex licensing-cost.

On AppExchange, large number of apps fail because of incorrect user licenses/features and due to lack of understanding many organizations ended up paying more than required because they don’t know how to optimize their licenses.

Here are some of the important tips on how you can optimize your Salesforce Licensing Cost:

1. Choose the license as per your requirement:

Many companies blindly purchase the Salesforce enterprise edition user licenses, Which allows complete access to standard CRM and Force.com AppExchange apps. While such enterprises get access to any standard or custom app as required and free from restrictions but they may actually never use all the functionalities, for which they are paying a huge amount.

So, despite choosing the complete enterprise edition they can make smart choices by adopting other available licensing options that allow them to get the power of Salesforce CRM without paying the heavy license fee.

Like,

  • Salesforce Platform License:

The Salesforce Platform License is suitable for the organization who has a strong in-house development team. It provides access to custom apps developed by themselves or uploaded into force.com AppExchange, but they cannot access standard CRM functionality. It allows access to core platform functionality like accounts, contacts, reports, custom-tabs etc, but with restrictions on user permissions and some other restrictions.

Another license that is Salesforce Platform Light, is better for small and medium businesses. This is same as the above but it has monthly login limit of the user.

Both of these licenses works extremely well for the organizations that have created custom objects to handle new data sets and do not need the ready-made CRM objects, such as “Cases,” “Leads,” “Solutions,” “Campaigns” and others available in Salesforce Enterprise Edition.

  • Don’t Sign-up for Packages blindly:

Sometime in hurry, we chose the packages blindly without researching much. We should remember that Not all may be a good deal. For Example, the Social Enterprise License Agreements (SELA), which includes social tools such as Heroku and Radian6, is an attractive proposition for businesses in the middle of a growth phase or wanting to deploy the bulk of Salesforce.com’s software portfolio on a rapid basis. But it would turn out more expensive than standard subscriptions for other businesses who cannot scale up or adopt the volume of software apps in the expected time-frame.

2. Use Force.com Licenses:

Organizations can save on licensing by subscribing to Force.com Licenses for its users rather than subscribing to the Salesforce Enterprise Edition.

Salesforce Enterprise license costs around $1500 a year/license while a Force.com Enterprise license costs only $300 per license per user/year. By this way, Organizations can save $1200/license every year.

10 custom objects with the same functionality available in Salesforce Enterprise Edition is accessible by the Force.com enterprise users. Force.com App Bundle Edition Upgrade gives users access to 200 custom objects for $960 per license/year, which is still a saving of $540 per license/year.

There are two options available with Force.com license. One is Force.com One App License and another is Force.com-Free License.

One App, is for the users who need access to just one custom app. It is similar to Salesforce Platform license but limited to just one app and read-only access to Accounts and contacts objects.

Where As, Free License allows users to run one custom app. It’s same as license one App but without any access to accounts and custom objects and no standard CRM functionality.

3. Go for Salesforce Modular Build License Approach & Decide What Exactly is required

Salesforce.com allows a modular approach by offering add-on functionality at an additional cost to the basic offering.

For Example, mobile functionality, knowledge base module, offline access, visual workflow, partner and community portals and more, each one of the listed functionalities costs extra to the basic license fee.

While the modular structure allows users to pay only for what they need, getting the advantage requires having a clear-cut idea on, what functionality is actually required. Simply adding on functionality just because it is there and seems good may result in the enterprise incurring costs unnecessarily.

4. Manage Users Proactively

Despite the type of license taken, one license allows only one user to log-in, and it is not possible to share login credentials for that user with other users.

It makes sense to log a case with “License Reduction” in the subject field and follow it up as soon as a user is de-activated and the license is not required to be re-assigned to someone else. Organizations with a large number of licenses can reduce the license costs extensively over time if they take this up proactively.

5. Negotiate

Always Negotiate with your Vendor for Pricing at renewal. Track actual usage of the app over time, and if usage is low, try and negotiate with Salesforce.com during the annual renewal phase.

Salesforce is the Global leader in CRM offerings and always ranks number 1 in this arena. So to make the best of it do keep in mind the above tips to enjoy the power of this truly amazing CRM without spending much.