Salesforce License Management Best Practices
Executive Summary:
Salesforce license management is about preventing overspending while making sure users have the access they need.
This article offers best practices for day-to-day control and long-term planning of Salesforce licenses. Readers will learn how to handle license changes (adding users, adjusting counts) in a smooth and cost-effective way.
Avoid Overcommitment and Shelfware
Once you commit to a number of Salesforce licenses, you’re locked into that quantity until the term ends. If you buy too many, those extra “shelfware” licenses will sit unused – but you still pay for them.
For example, a company that downsized after signing a multi-year Salesforce deal found it had to keep paying for a large number of unused licenses — because reductions weren’t allowed mid-term.
Practical Tip: Be cautious with your initial license count. It’s better to start small and add later than pay for shelfware.
Negotiate flexibility in your contract – for example, a right to reduce or swap some licenses if needs change, or at least ensure you can add users later at the same discounted rate.
Optimize License Types and Usage
Not every user needs the most expensive Salesforce license. If you give everyone the highest-tier license by default, you’ll pay for lots of features that go unused.
For example, one firm realized many employees had expensive Enterprise Edition licenses but only used basic CRM features – they could have been on much cheaper licenses without any impact.
Practical Tip: Tailor license types to actual needs. Identify users who can be moved to lower-cost license categories (e.g. read-only, platform, or light access licenses) without impacting their work. Conversely, if you’re paying for premium features, make sure your team is aware and trained to use them.
Manage Mid-Term Additions and Changes
Sudden business changes – a new project or acquisition – can require more Salesforce users before your renewal.
If you haven’t planned for mid-term growth, those extra licenses might come at full cost. For instance, one company suddenly had to add a significant number of users mid-term, and those licenses ended up costing more per user because pricing wasn’t locked in upfront.
Practical Tip: Plan for growth and change as part of your initial deal. Negotiate a true-up clause or price protection so any licenses you add mid-term are priced at the same rate or discount as your original purchase (and co-termed to end at the same renewal date).
You might also consider slightly under-buying initially and then using that pre-negotiated true-up to add licenses as needed, which avoids overcommitting yet covers expansion. That way you won’t face inflated charges if you need to scale up mid-term.
Understand Salesforce’s Product Pricing Models
Salesforce’s products have varied licensing models – core CRM is sold per user, but other products (Marketing Cloud, Tableau, etc.) use different metrics (contacts, data volume, user roles).
Knowing these differences is key to budgeting and negotiating effectively.
The table below highlights a few examples:
| Salesforce Product/Cloud | Primary Pricing Model | Key Cost Drivers & Notes |
|---|---|---|
| Sales/Service Cloud (CRM) | Per user per month (by edition) | Cost mainly driven by user count. Higher editions cost more (include more features). Watch out for data storage or API usage over the standard limits. |
| Marketing Cloud | Based on contacts or messages sent (usage-based) | Scales with the size of your marketing database and message volume, rather than number of users. Typically sold in tiered contact-count packages. |
| Tableau (Analytics) | Per user (Viewer/Explorer/Creator roles) or core-based (server capacity) | Priced either by user roles (view-only vs. full creator licenses) or by server cores for enterprise deployments. Cost depends on number of users or allocated capacity. |
Recommendations
- Map User Needs to License Type: Align each user’s role with the right license. Don’t assign a full Salesforce license if a cheaper option meets the user’s needs.
- Audit Usage Before Renewals: Before each renewal, review how each department is using Salesforce. Identify inactive users, under-used features, or opportunities to downgrade licenses, and adjust your license counts accordingly.
- Negotiate for Flexibility: In your contract, include terms that let you adjust as needed. For example, negotiate rights to swap license types or maintain a pool of extra licenses that can be activated if your needs grow or change.
- Centralize License Requests: Require all new Salesforce license requests to go through a central review (IT or procurement). This prevents business teams from over-buying on their own and lets you reallocate any unused licenses first.
- Track Contract Milestones: Keep a calendar of key Salesforce contract dates – renewal dates, notice deadlines for reductions, and expiration of any special pricing terms. Missing a notice deadline could lock you into unwanted licenses for another year, so stay on top of these milestones to preserve your options.
Checklist: 5 Actions to Take
- Inventory Your Licenses: Create a list of all Salesforce licenses in use and who has them. Include last login dates and what key features each person uses.
- Identify Optimization Opportunities: From that inventory, flag licenses to remove or downgrade. Look for unused accounts and users on high-tier licenses who only use basic features.
- Review Contract Terms: Note your Salesforce renewal date, any notice period for reductions, and any true-up or price-increase clauses in your contract.
- Engage Stakeholders Early: Well before renewal, meet leaders from each department. Agree on where you will expand or cut back licenses so there are no last-minute surprises.
- Develop a Negotiation Game Plan: Formulate your strategy for the upcoming Salesforce renewal. Use your usage data and stakeholder input to set targets (e.g. license counts, discount level, needed contract terms) and get executive support for these goals.
By following these steps, IT procurement and asset management teams can take control of Salesforce licensing well before contract deadlines. This ensures you’re driving the conversation with facts and a plan, rather than reacting under pressure.
FAQ
Q1: Can we reduce our Salesforce license count mid-contract if our user count drops?
A: No. Once you commit, you can’t reduce licenses mid-term. Plan for possible downsizing by negotiating flexibility (like reduction rights) before you sign.
Q2: How far in advance should we start planning for a Salesforce renewal?
A: Begin at least 6 months before renewal. That gives you time to audit usage, gather needs from the business, and approach Salesforce with a solid plan instead of rushing at the last minute.
Q3: What is a Salesforce Enterprise License Agreement (SELA) and should we consider it?
A: It’s a long-term, fixed-price deal covering many Salesforce products. It offers flexibility if you expect to massively expand usage, but requires a huge upfront commitment. If you overestimate your needs, you overpay — so only consider a SELA if you’re confident in big growth.
Q4: How should we handle other Salesforce products like Marketing Cloud, Tableau, or Slack in our license management?
A: Manage these products with the same rigor as your core Salesforce licenses. Track their usage and costs, and try to co-term or negotiate them alongside your main Salesforce deal so nothing is overlooked in your planning.
Q5: Do we need to give notice to drop licenses, or will unused licenses automatically expire at renewal?
A: Yes. You must notify Salesforce (usually 30–60 days before contract end) if you plan to reduce licenses or cancel a product at renewal. If you don’t give notice, you’ll likely be renewed for the same number of licenses for the next term.
Read more about our Salesforce Contract Negotiation Service.
