Renewing SaaS contracts can seem straightforward, but it’s often a missed opportunity for businesses to secure better terms, reduce costs, and evaluate whether the software still meets their needs. Without careful planning, contract renewals can lead to overspending, unnecessary features, and inflexible agreements.

Here’s how to avoid the most common mistakes when renewing your SaaS contracts and make the process work to your advantage.

Mistake 1: Waiting Until the Last Minute

One of the most frequent mistakes is leaving contract renewals until the eleventh hour. Rushed renewals give vendors the upper hand and limit your ability to negotiate.

How to Avoid It:
Start the review process well in advance—ideally three to six months before the contract end date. This gives you enough time to assess your needs, research alternatives, and approach your vendor with data-driven negotiation points.

Pro Tip: Create a centralised calendar or use a SaaS management tool like Vertice to track contract expiration dates and set reminders for key milestones.

Mistake 2: Not Evaluating Usage and ROI

Businesses often renew contracts without questioning whether the software is still worth the investment. Over time, tools may become underused, redundant, or misaligned with evolving business goals.

How to Avoid It:
Conduct a usage analysis before renewing. Check how many licences are actively being used, which features are valuable, and whether the software is delivering measurable returns.

Example: A sales team might be using only 60% of a CRM’s capabilities. If the unused features drive up the cost, renegotiating for a tailored plan—or exploring alternatives—could save money.

Mistake 3: Overlooking Redundancy in Your Stack

As businesses grow, it’s common for overlapping tools to creep into the software stack. Renewing a contract without considering redundancies can lead to wasted spend.

How to Avoid It:
Review your entire software stack during the renewal process to identify overlap. For example, you might have two tools for team communication when one could suffice. Consolidating platforms can simplify workflows and cut costs.

Mistake 4: Failing to Negotiate Terms

Many businesses assume that SaaS contracts are set in stone, but vendors are often open to negotiation, especially for long-standing clients or bulk purchases.

How to Avoid It:

• Negotiate Pricing: Ask for discounts, especially if your team’s usage has decreased or you’re considering multi-year commitments.
• Seek Flexibility: Push for terms like the ability to scale licences up or down based on usage.
• Discuss Customisation: Tailor the contract to remove unnecessary features or add ones your team needs.

Mistake 5: Ignoring Vendor Roadmaps and Updates

Renewing without understanding the vendor’s future plans can lead to surprises down the line, such as feature removals, price increases, or changes in service levels.

How to Avoid It:
During renewal discussions, ask vendors about their product roadmap. Are there upcoming changes that could impact your business? Will pricing structures or feature sets be adjusted in the near future? Understanding these details can help you make a more informed decision.

Mistake 6: Overcommitting to Long-Term Agreements

While long-term contracts often come with discounts, they can also lock you into a platform that may not meet your future needs.

How to Avoid It:
Balance the cost savings of a multi-year agreement with the flexibility of shorter-term contracts. If you opt for a long-term deal, ensure there’s an exit clause or an option to adjust terms as your business grows.

Mistake 7: Failing to Secure Proper Support and SLAs

Support quality and service-level agreements (SLAs) often go overlooked during renewals, but they’re critical for ensuring the software meets your expectations.

How to Avoid It:
Review support levels and SLAs before renewing. Ensure the vendor guarantees response times, uptime percentages, and reliable customer support.

Example: A healthcare company renewed a SaaS tool after negotiating stricter SLA terms, ensuring faster support response times critical for their operations.

Mistake 8: Not Considering Alternative Vendors

Sometimes, businesses renew simply out of convenience, even when better options are available.

How to Avoid It:
Before committing to a renewal, explore competitors to see if they offer better features, pricing, or support. Even if you choose to stick with your current vendor, knowing your options can strengthen your negotiation position.

Turning Mistakes Into Opportunities

Renewing SaaS contracts doesn’t have to be a routine task. It’s a chance to optimise your software stack, cut unnecessary costs, and ensure your tools align with your goals.

By starting early, reviewing usage data, negotiating smarter, and exploring alternatives, you can make every renewal an opportunity for improvement.