RISE with SAP Negotiations: Breaking Down the Hidden Costs and Securing Flexibility

RISE with SAP Negotiations: Breaking Down the Hidden Costs and Securing Flexibility

Executive Summary: Negotiating a RISE with SAP agreement can be challenging – it’s a bundled deal that often conceals unexpected costs and restricts flexibility.

This advisory breaks down the hidden cost drivers in the RISE with SAP bundle and provides strategies to secure more favorable terms.

By unbundling RISE pricing, benchmarking against market data, and locking in key contract clauses (like renewal caps and exit terms), enterprises can avoid surprises and negotiate a RISE deal that meets their cost and flexibility needs.

The insights below, written in a direct and professional tone, reflect 2025 trends and lessons learned, offering a clear roadmap to navigate RISE with SAP negotiations.

Read about the Rise with SAP overview.

Hidden Costs Lurking in the RISE Bundle

RISE with SAP promises an all-in-one cloud ERP package, but the convenience can mask several hidden costs.

Sourcing leaders must proactively surface these costs during negotiations to avoid budget shock later.

Key hidden cost areas include:

• Cloud Infrastructure Markups: SAP bundles cloud hosting (via hyperscalers like AWS/Azure) into RISE, often without transparent pricing. You may pay a premium for this convenience, and if your system is initially undersized, scaling it up later incurs an additional cost. Conversely, oversizing means paying for idle capacity. Always ask what cloud resources are included and how growth is charged.
• Indirect Usage Fees: Don’t assume RISE with SAP covers all your use cases. If third-party systems (e.g., e-commerce platforms or IoT devices) interact with your SAP data, you could incur indirect access licensing fees. Many enterprises have been caught off guard by charges for external systems accessing their SAP systems. Negotiation tip: Ensure your RISE contract addresses digital access – either include a sufficient document license or a clause covering known integrations – to prevent surprise fees. Read more digital access pitfalls in RISE deals.
• BTP and Add-On Services: RISE deals often include a starter pack of SAP Business Technology Platform (BTP) credits or other SAP services (like Signavio or Business Network). The catch: if you exceed the modest included amounts, overage fees can accumulate quickly. Customers extending their ERP with numerous custom apps or analytics on BTP have seen costs escalate beyond their expectations. Clarify exactly how much BTP usage is included, and negotiate for a cap or discounted rate on overages if you expect heavy use.
• Migration and Implementation Costs: Moving to RISE is not a turnkey project – the subscription covers software and infrastructure, but not the actual migration effort. Expenses for data migration tools, system integrator (SI) services, re-implementing custom code, and testing/training can rival the subscription cost itself. These are “hidden” in the sense that SAP’s RISE proposal won’t include them. Enterprises should budget for these separately and perhaps use SAP’s eagerness for a RISE deal to secure migration support credits or services.
• Future Growth and Volume Surprises: RISE contracts fix your subscribed capacity (users, storage, etc.) for the term. If your business usage grows beyond that, expect additional fees (often at list price). Extra users, extra memory/storage, higher API calls – all can trigger charges. To mitigate this, consider negotiating some headroom: for instance, lock in pricing for an additional block of users now, or include a clause that stipulates additional storage will be at a predefined rate. Planning for growth during negotiations prevents paying a premium later.
• Vendor Lock-In Costs: Finally, the cost of exit itself is a hidden liability. Once you’re in RISE with SAP, switching away (or even reverting to on-prem) is costly and complex. This “cost” may not hit until the end of the term, but it gives SAP leverage to hike prices later. We’ll discuss exit strategies in depth below – but recognize that the bundled model can become golden handcuffs. Negotiating terms to ease a future transition (like data export rights or conversion options) is essential to avoid an expensive trap.

Takeaway: Go into RISE with SAP negotiations with eyes wide open about these hidden costs. Itemize everything that could incur extra fees – from indirect access to storage growth – and get clarity or contractual safeguards for each. By surfacing these issues early, you can address them in the contract (or at least know the risk) rather than getting unpleasant invoices down the road.

Unbundling RISE Pricing – What Are You Paying For?

RISE with SAP combines software, support, and cloud infrastructure into a single price. As an enterprise buyer, unbundling that price is key to understanding value.

Ask SAP for a detailed breakdown of the RISE proposal (even if they resist, it signals you won’t accept a black-box price). In practice, you should dissect the bundle into components and evaluate each:

• S/4HANA Software Subscription: This is the core ERP license component. In a standalone world, you’d pay a big upfront fee for perpetual licenses and yearly maintenance (~22% of license cost). In RISE, these are replaced by a recurring subscription fee, often measured in Full User Equivalents (FUEs). While there’s no upfront cost in RISE, you lose perpetual rights. Analysis: Compare the multi-year cost of subscription vs. owning – if you plan to use SAP for 10+ years, subscriptions might cost more in the long run (especially if fees increase). SAP often touts RISE as having ~20% lower TCO over 3 years, but by year 5, the gap can close or reverse. Always model the costs over the duration you expect to run the system, not just the initial term.
• Infrastructure & Hosting: RISE includes cloud infrastructure (datacenter, hardware, basic Basis administration) managed by SAP. If you sourced this yourself, you’d have a separate contract with, say, AWS or Azure, and possibly an MSP. Key point: SAP’s RISE price for infrastructure is often higher than raw cloud costs – it bundles convenience and support, possibly with a markup. To unbundle, estimate what the equivalent cloud instance and storage would cost if you ran it directly. This gives a benchmark to gauge SAP’s premium. It’s fine to pay a bit more for simplicity, but you should know how much more. Also, confirm that the RISE price includes all necessary environments (Dev/Test/Prod) and sufficient disaster recovery capacity – extras here can be very expensive if not included in the initial price.
• Support & SLA: In a traditional model, you pay annual maintenance and deal with SAP support separately. With RISE, support (for S/4HANA and the infrastructure) is baked in. SAP will handle updates and patches, providing an SLA for uptime. Check the fine print: What is the SLA (and are penalties meaningful)? Are there maintenance windows that could impact you? Also, note that while basic support is included, premium support, such as SAP MaxAttention, is not – that’s an additional cost if you need it. Ensure the service level meets your enterprise requirements or negotiate improvements (e.g., stronger SLA remedies, faster response for critical issues) as part of the deal.
• Value-Added Components: RISE often bundles additional “value” components – for example, limited use of SAP Business Network (Ariba), Signavio process mining, or SAP Analytics Cloud. These can be enticing, but ask yourself: will we use them? They might be “free” up to a point, but you’re indirectly paying via the subscription. Any component you don’t need is leverage – ask to remove it for a better price, or ensure it doesn’t inflate the cost. Unbundling means not paying for shelfware. One enterprise discovered that they were paying for a Signavio license in RISE that they had never deployed – effectively wasting money. Don’t let bundled extras become hidden shelfware in your contract.

Unbundled Price Comparison: To illustrate the importance of unbundling, consider an example 3-year cost comparison for a 1,000-user SAP environment:

Illustrative scenario: In this example, RISE appears to be ~15-20% cheaper over three years, primarily by avoiding the significant upfront license cost. However, by year 5, the cumulative spend evens out (around $13M each in this scenario) as ongoing subscription fees catch up with the one-time purchase model.

This underscores a crucial point in RISE with SAP negotiations: short-term savings are real, but it is essential to consider the long-term costs.

If SAP’s proposal looks attractive in the initial term, consider what will happen at renewal (years 4, 5, etc.). Without negotiated protections, a steep renewal hike could erase any savings.

Takeaway: Break down the RISE bundle into its parts to evaluate cost-effectiveness. Use internal benchmarks (e.g. your current support costs, cloud quotes, etc.) to challenge SAP’s pricing. If any component of the bundle doesn’t add value for you, treat it as negotiable. An informed customer who understands the true cost drivers is much harder for SAP to upsell or overcharge.

Benchmark Your RISE Deal Against the Market

SAP’s first offer for RISE is just that – a starting point. To negotiate effectively, benchmark everything.

By 2025, thousands of RISE with SAP deals are expected to have been signed, providing data on typical discounts and terms.

Smart enterprises leverage this information to avoid overpaying:

• Know the Discount Range: Don’t settle for list price or a token discount. Many organizations have achieved double-digit percentage discounts on RISE subscriptions. For example, it’s not uncommon to see 15-30% off SAP’s initial quote for a well-negotiated deal. In some aggressive cases (especially large enterprises or competitive scenarios), discounts of ~50% off list have been reported. Utilize industry contacts, user groups, or third-party advisors to gather insights into what peers are paying. If you have a procurement consultant or a licensing expert firm, they often have anonymized data points (“Company of similar size got 40% off and a 5% cap on renewal”). Presenting such benchmarks to SAP can significantly improve your bargaining position. Essentially, you’re signaling “we know what the market pays – match it.”
• Compare Alternative Paths: Benchmarking isn’t only about peer deals – it’s also comparing RISE to your Plan B. For instance, price out the scenario of staying on-premises (with an upgrade to S/4HANA on your terms) or using a different cloud arrangement. If continuing with your existing SAP ECC for a few more years (with extended support or third-party support) is less costly than RISE, please let SAP know you have that option. Likewise, if a direct S/4HANA public cloud SaaS (outside of RISE) or a competitor’s ERP is on the table, that’s leverage. Even if you fully intend to go to RISE, showing that you have evaluated other options keeps SAP honest. They are aware that as of 2025, not all customers are on S/4HANA yet – you may have the leverage of “we can wait.” Use it to push for a better deal now.
• Total Cost of Ownership (TCO) Perspective: Bring a multi-year TCO model to the negotiation. Demonstrate to SAP that you’re analyzing the 5- or 10-year cost, not just the initial term. This is important if, say, you’re concerned about RISE being cheap up front but expensive later. If your model shows RISE edging out on-prem by Year 3 but losing by Year 6 (for example, due to anticipated price hikes), use that in discussions: “By our analysis, RISE saves us $X in 3 years but could cost more over time. We need assurances on long-term costs (or a bigger upfront discount) to justify this move.” This kind of data-driven negotiation makes it harder for SAP to dismiss your asks.
• Leverage SAP’s Deadlines: SAP has its pressures – the 2027 support deadline for ECC, quarterly sales targets, and so on. Gartner notes that many customers feel pressured into RISE as those deadlines loom, with fewer alternatives offered by SAP sales. You can turn this pressure around. If you’re negotiating near a quarter-end or year-end, SAP’s urgency to close the deal can be your gain. There are documented cases of companies aligning their RISE negotiations with SAP’s fiscal year-end to unlock an additional discount that wasn’t initially offered. Being ready to sign at SAP’s “crunch time” can extract concessions – just be careful not to rush your due diligence for their timeline.

Takeaway: Treat a RISE with SAP proposal not as a fixed menu, but as an opening bid that must be validated. Benchmark against both external data (what similar enterprises pay, typical contract terms) and internal alternatives (what if we do something else?). If SAP knows you’re educated on the market and willing to pursue other routes, they will sharpen their pencil. In negotiations, information is power – and benchmarking provides that information.

Demanding Flexibility: Protect Your Contract from Lock-In

A common criticism of RISE with SAP is that it can feel “one-size-fits-all” and lock in customers for years.

Standard RISE contracts favor SAP’s predictability – multi-year commitments, fixed resources, and limited outs.

As a negotiator for your enterprise, you need to inject flexibility into the deal wherever possible:

• Contract Term and Renewal: Opt for a shorter initial term if possible. A 3-year term gives you a sooner checkpoint to re-evaluate or renegotiate, compared to a 5-year lock-in. SAP may push for longer terms, but even if you agree to, say, 5 years to get a deeper discount, absolutely negotiate the renewal terms upfront. Insist on a cap on renewal price increases – e.g., no more than 5% increase at renewal, or even a flat renewal at the same rate for one extension term. By default, SAP’s contracts may allow them to raise the price without limit after the term, which poses a significant risk. Don’t leave it to “good faith” – get a percentage cap or fixed price renewal clause in writing. This protects you from “sticker shock” after you’ve invested in the RISE platform.
• Volume Flexibility (Users and Usage): Under standard terms, RISE is inflexible in the mid-term – you can add more users or capacity (at an additional cost). Still, you generally cannot reduce what you’ve committed. Try to negotiate at least one mid-term adjustment option. For example, some customers have secured a one-time reduction right if they divest a business or have a significant change, allowing them to drop some users (or swap for another service of equal value). Not all SAP reps will agree, but it’s worth asking: “What if we need 20% fewer users in year 2 – can we get some relief?” At a minimum, negotiate the ability to true-down at renewal without penalty.
  Additionally, to avoid overpaying from the start, right-size your initial user count. Analyze the actual usage of your current licenses – often, companies find that 10-30% of users are inactive or over-licensed. If you base RISE on a slimmer, optimized user count, you save money and reduce the need to drop users later. (Remember, you pay for authorizations, not actual logins – so don’t authorize more users than necessary).
• Swap and Conversion Rights: Businesses evolve, and your needs in two years may not align with those of today. Try to bake in some flexibility to repurpose your investment. For instance, ask for “swap rights”: the ability to exchange part of your RISE subscription for another SAP product of equal value. Perhaps you initially subscribed to a large number of S/4HANA users, but later you may need fewer core ERP users and more SAP BTP services or an industry cloud solution. Having a contractual mechanism to shift spending helps ensure you’re not stuck with mismatched capacity. SAP will rarely grant full swap rights in a standard contract, but it may allow options such as using unused subscription value toward other cloud services or a one-time swap of a module. Even partial flexibility here can save money and keep your digital transformation on track if priorities change.
• Performance and Service Flexibility: Ensure the contract isn’t just financially flexible, but also operationally flexible. Define what service levels and support you require. If you need the ability to, say, perform certain basic tasks or have influence over upgrade timing (in private cloud scenarios), negotiate it. Standard RISE may put all control in SAP’s hands, which can be inflexible for you. If continuous innovation is key, ensure the contract doesn’t prevent you from deploying additional SAP cloud services alongside RISE. Also, clarify that you can integrate non-SAP solutions as needed – you don’t want any clause that effectively boxes you into only SAP tools. Flexibility to innovate and integrate should be part of your deal, not just the letter of the contract capacity.

Takeaway: You’re signing a long-term relationship – make sure the contract has “guardrails” that protect you as things change. Every point of flexibility you secure (be it a pricing cap, an adjustment right, or a swap option) reduces the risk of regret later. Even if SAP’s answer is “that’s not standard,” push the conversation – many customers have quietly obtained special terms by insisting on them, especially if they were a make-or-break issue for the deal.

Plan Your Exit Strategy from Day One

It may sound ironic, but the time to plan how you’ll exit RISE with SAP is before you sign up. A common negotiation mistake is focusing only on onboarding and ignoring the offboarding.

Don’t assume you’ll be on RISE forever – market conditions, leadership decisions, or better options in a few years could change your direction.

Secure provisions now to avoid being handcuffed later:

• Data Retrieval and Decommissioning: Negotiate explicit rights to retrieve all your data from SAP’s cloud in a usable format at contract end. This includes application data in S/4HANA and any related content (documents, configurations). Ideally, have SAP commit to providing a full data dump or export service as part of termination assistance. Also consider an arrangement for read-only access post-contract – e.g., a license to access the system for 6-12 months for audit or reference, even after the subscription ends. Without these terms, you risk a scenario where on day 1 after your contract expiration, you’re locked out of your ERP data – a nightmare for compliance and reporting.
• Exit Clauses and Triggers: Generally, SAP does not allow early termination of RISE agreements (you’re expected to pay for the full term). However, it’s worth discussing scenarios for termination for cause. For example, can you insert a clause that if SAP fails to meet critical SLAs repeatedly or if a major regulatory change prevents use of their cloud, you have the right to terminate without penalty? SAP’s willingness here is limited, but asking puts them on notice that you take SLAs seriously. A more feasible approach is to negotiate a manageable term (as mentioned, shorter is better) and focus on the end-of-term exit. Know that early exit will be painful – so concentrate on making the end-of-term decision flexible.
• Retention of License Rights: One strategic consideration: If you’re coming from SAP perpetual licenses, check if you can retain any rights to those licenses. In many RISE conversions, your old licenses are terminated or put on hold (often called “shelving” your licenses). That means if you drop RISE later, you’d have to license SAP anew if you wanted to run on-premises or in another cloud. Some customers negotiate to keep a skeleton of their old license active (maybe by not converting everything to RISE, or having an option to revive licenses). Even if that’s not possible, be aware of this loss – and thus negotiate options such as a perpetual license for S/4HANA at contract end for a predefined price. SAP may or may not agree, but having the conversation can sometimes lead to creative solutions (e.g., a discounted “re-entry” license if you leave RISE). The goal is to avoid feeling 100% stuck.
• Leverage at Renewal: A well-planned exit strategy serves as a valuable form of leverage. If SAP knows you have your data and systems prepared for potential migration, you have a stronger hand in renewal talks. Throughout the RISE term, continue to evaluate alternatives – could you consider switching to a different model or provider when this term ends? Let SAP feel that competitive pressure. In 2025, for instance, some enterprises are already exploring if a combination of SaaS apps or a different ERP might suit them post-RISE. You don’t need to disclose these plans, but having an “alternative path” gives you confidence. When renewal time comes, you can negotiate without desperation. If SAP’s renewal quote is too high, you genuinely have the option to walk. Ironically, that likelihood of walking often results in SAP offering a more reasonable renewal to keep you.

Takeaway: Lock-in is only a risk if you have no escape plan. By baking in data access rights, understanding your fallback options, and keeping contract terms from being too onerous, you ensure that you remain in control. Planning the “end game” now means that when the initial RISE term is up, you can negotiate a renewal or transition on your own terms – not SAP’s. As the saying goes, hope for the best, but plan for the worst. If you have an exit strategy from day one, you’ll never find yourself cornered by your SAP agreement.

Read more in-depth negotiation strategies.

Leverage Timing and Incentives in Your Favor

In enterprise software deals, the decision to buy can be just as important as the actual purchase. SAP’s sales incentives and timelines can be used to your advantage in RISE with SAP negotiations:

• Quarter-End Deal Sweeteners: Like most vendors, SAP has targets to meet. As mentioned earlier, aligning your negotiation with SAP’s end-of-quarter or fiscal year-end can unlock extra savings. Be strategic: start discussions early but schedule final approvals around these crunch times. SAP representatives have been known to offer improved discounts or include extras to secure a deal by the Q4 deadline. One enterprise sourcing team reported securing an additional 15% off a RISE subscription simply by timing the closure for late December, which was SAP’s year-end push. The key is not to let SAP rush you into a poor deal; instead, if you’re ready, use their urgency to negotiate a better price.
• SAP’s Migration Incentive Programs: Be aware of any official incentive programs SAP is running. In recent years, SAP has offered various credits to entice RISE adoption. For example, there have been programs offering credits equal to a portion of first-year fees to offset migration costs, or allowing customers to apply unused on-prem support payments toward the subscription. In 2024, some customers moving to RISE received credits worth 50-60% of their first-year RISE fees – essentially a big temporary discount. These programs are subject to change over time, so please consult your SAP account team and don’t hesitate to request any available incentives in writing. If SAP has publicly announced migration deals (like extended maintenance or pricing relief for early movers), bring those into the negotiation: “We expect to receive the same 60% migration credit that others have gotten.” Leverage the fact that SAP wants success stories of customers moving to RISE.
• Trade-In and Shelfware Negotiation: If you have a significant amount of sunk costs in SAP licenses, use them as a bargaining chip. When you move to RISE, you’re effectively trading in your perpetual licenses for a subscription. Ensure you get credit for what you’ve paid. For instance, if you bought $10M of SAP licenses years ago that you’ll be dropping, push for a significant reduction in the RISE price to recognize that investment. Many enterprises negotiate a “conversion credit” – sometimes near the full value of remaining unused licenses or a significant percentage of their current maintenance spend – to avoid the perception of having paid twice. Also, identify any shelfware (licenses or subscriptions you aren’t using effectively) and bring them to your attention. It might translate into a one-time discount or service credit in the new deal. The message to SAP is: “We’ve invested in your software; we expect a fair trade-in value when moving to your cloud.”
• Don’t Pay Double During Transition: A practical timing consideration – coordinate your RISE start date with your existing contracts. If you’re paying SAP maintenance on an old system and sign up for RISE today, you don’t want an overlap where you pay maintenance and subscription simultaneously. Negotiate a “dual-use period” where you run old and new systems in parallel during migration without extra charge. Often, customers secure 6 months or more of overlap, allowing the legacy system to remain live (for cutover, testing, etc.) while only paying for RISE. Alternatively, start the RISE subscription the month after your maintenance expires (and get SAP to agree to bridge support if needed). The goal is zero double-payment. SAP will usually accommodate this request if it is made, as it’s a reasonable request to facilitate a smooth migration.
• Watch for Policy Changes: Finally, keep an eye on SAP’s pricing policy updates around RISE. In 2025, for instance, SAP introduced new packaging (like the “Cloud ERP, private edition” offering) that adjusted price metrics and list rates. These shifts might not be obvious, but user groups (like DSAG or ASUG) often publish analyses. If you hear that SAP has raised cloud list prices or changed how FUEs are calculated, incorporate that into negotiations (e.g., “we know the new edition has higher base prices – therefore, we need a bigger discount to net out the same as older deals”). Staying informed on SAP’s changes helps ensure a subtly worse deal does not blindside you.

Takeaway: Timing and negotiation go hand-in-hand. Use SAP’s calendar and incentive programs to maximize value. A well-timed ask can yield not just a lower price, but also funding for services or more favorable terms. Remember, the best negotiators not only haggle on price and terms – they also orchestrate when to strike the deal for maximum leverage.

Learn more about the breakdown of RISE costs vs self-managed.

Recommendations (Practical Tips for Negotiating RISE with SAP)

• Unpack the Bundle: Demand Clarity. Ask SAP to explain exactly what’s in your RISE bundle (software, infra, support, extras) – and what’s not. Refuse to negotiate on a lump sum; break it down into components that you can assess and question.
• Benchmark Aggressively: Enter talks armed with data. Leverage industry benchmarks or advisors to know typical RISE discounts, pricing per user, and contract concessions others obtained. Use this to set your target price and terms.
• Right-Size Before You Sign: Optimize Your SAP Footprint Before RISE. Clean up inactive users and unused modules now. The fewer FUEs and services you truly need, the lower your RISE cost will be. Don’t let outdated license counts inflate your subscription.
• Cap the Increases: Never accept an open-ended renewal. Negotiate a cap on annual price increases (e.g., CPI or a maximum of 5%) or fix the renewal price in advance. This prevents nasty surprises when it’s time to renew your RISE contract.
• Protect Against Overage Fees: If you anticipate heavy use of SAP BTP, additional environments, or high transaction volumes, address these requirements upfront. Negotiate for additional BTP credits, predefined rates for extra capacity, or at least transparency into how overages are charged.
• Secure Flexibility Clauses: Push for contract clauses that add flexibility – a mid-term adjustment right, swap rights between services, and the ability to reduce or rebalance at renewal without penalty. Even if not standard, any flexibility you gain is a win.
• Plan an Exit (Even if You Don’t Use It): Ensure the contract details your end-of-term options. Get agreements on data export assistance, read-only access post-contract, and an understanding of what happens if you don’t renew. A clear exit plan is an essential component of a well-planned entry strategy.
• Leverage Timing and Competition: Schedule negotiations with SAP’s sales timeline in mind. Use quarter-ends for leverage and don’t be shy about mentioning alternative options (extended ECC support, competitors, or delaying the project) to extract a better offer.
• Document Everything: As you negotiate, document every promise or representation from SAP – then get it in the contract. If they say “Yes, that small add-on is included” or “We’ll help with X if needed,” ensure it’s written down. Verbal assurances mean nothing once the contract is signed.

For a better understanding of FUE metrics to negotiate effectively.

Checklist: 5 Actions to Take Before Signing

1. Audit Your Current State: Gather your SAP usage data – active users, modules in use, custom integrations, and current costs. Identify any shelfware and confirm what you truly need in the future state.
2. Break Down SAP’s Proposal: Take SAP’s RISE quote and dissect it. Determine your estimate for software, infrastructure, support, and other related expenses. Ask SAP to fill in any blanks. This will highlight if any component is overpriced or unnecessary.
3. Gather Benchmarks and Set Targets: Research recent RISE deals (via peers or consultants). Establish your negotiation targets – e.g., “We want at least 20% off list, a 3-year term, and a 5% renewal cap.” Write these down as non-negotiables internally.
4. Prepare Your Negotiation “asks”: Create a checklist of terms to negotiate, including discount level, payment terms, renewal cap, user flexibility, included services, exit rights, dual-use period, and other relevant factors. Prioritize them so you know what to trade and what to stand firm on.
5. Review Contract Language in Detail: Once SAP provides a draft contract, review it line by line with legal and procurement teams. Look for any ambiguous terms related to scope (environments, support, uptime), and ensure that your negotiated points (discounts, caps, flex clauses) are accurately reflected in the contract. Don’t assume – verify everything in writing before you sign.

SuccessFactors Pricing Negotiation: Headcount Tiers, Modular Bundling, and Renewal Caps

FAQs

Q1: What hidden costs should we watch out for in a RISE with SAP deal?
A1: Key hidden costs include indirect access fees (for third-party systems accessing SAP data), overage charges for exceeding cloud resources or BTP credits, costs for additional environments or storage, and migration expenses (which are outside the subscription). Also, be wary of bundled “freebies” that aren’t truly free – if you won’t use that bundled service, it’s just driving up cost elsewhere. Clarify all these areas during negotiation to avoid surprises.

Q2: How can we tell if SAP’s RISE pricing is fair and competitive?
A2: The best approach is to benchmark. Compare SAP’s offer against what other similar enterprises paid (if you can obtain that info through consultants or user groups). Additionally, compare the RISE quote to the cost of running S/4HANA another way – e.g., licensing S/4HANA traditionally and hosting it yourself or with a cloud provider. If RISE is significantly higher than your Plan B over a multi-year period, that’s a red flag to negotiate down. Remember, SAP’s initial quotes often leave room for negotiation, so push for alignment with market standards.

Q3: Can we adjust our user count or cloud capacity if our needs change during the RISE contract?
A3: Not easily. Standard RISE contracts lock in your Full User Equivalents (user count) and resources for the full term – you can increase them (by paying more), but you typically cannot reduce them until renewal. This is why right-sizing at the start is critical. However, you can try to negotiate a one-time adjustment clause or, at the very least, the right to downscale at renewal without incurring penalties. Some customers have arranged special terms (for example, a reduction if a division is sold off), but these are exceptions. Plan conservatively to avoid overcommitment, and make flexibility a key discussion point in negotiations.

Q4: What happens at the end of a RISE with SAP term? Do we automatically own the system?
A4: No, since RISE is a subscription-based service, if you choose not to renew, your rights to use the SAP software will end. That’s why planning for the contract end is important. You should negotiate the terms of a transition if you don’t renew, including data export rights and possibly an option to extend access for a short period. You won’t “own” the system unless you negotiate a conversion to a perpetual license (which is not standard, but you could explore this option). Essentially, at the end of the term, you must either renew the RISE subscription, enter into a new agreement (perhaps a different SAP offering or an on-premises license), or be prepared to discontinue SAP. Ensure the contract doesn’t leave you stranded – include provisions to retrieve your data and support in the event of a move if needed.

Q5: Is RISE with SAP cheaper than staying on-premises or another approach?
A5: It depends on the time frame and how you use it. RISE can be cheaper in the short run – it eliminates large upfront costs and can reduce internal IT expenses (since SAP handles infrastructure and support). Many companies see savings in the first 2-3 years. However, over a longer period (5-10 years), the subscription fees can equal or exceed the cost of owning licenses and paying maintenance, especially if SAP raises prices over time. Each case is different: if your current infrastructure is aging and expensive to maintain, RISE’s value is higher. If you already run a lean, efficient IT operation, RISE might end up costing more. That’s why evaluating Total Cost of Ownership over your expected horizon is so important. Negotiating caps on increases and ensuring you’re not over-provisioned will help keep RISE’s costs in check versus the alternative.

Read more about our SAP Contract Negotiation Service.

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