SaaS stands for software as a service: software you rent by the month and use online, such as Xero or Mailchimp, instead of buying once. A five-person UK service business pays about £2,635 a year for its stack.
The number: UK Business Software Price Index.
What it means in practice
The mistake is judging SaaS by the monthly headline. Prices are often per user, and introductory offers end, so the bill you sign up to is rarely the bill you pay in month seven.
The move is to list every subscription at its full price after offers, multiplied by seats, and cancel anything nobody logged into last month.
Whito stage: Build. Review the stack once a year, and before adding any new tool.
The numbers to hold onto
- A five-person UK service business pays about £2,635 a year including VAT for a standard stack. UK Business Software Price Index.
- A credible sole-trader stack costs about £18 a month. UK Business Software Price Index.
- Xero’s Grow plan is £444 a year at full price, 4.8 times HMRC’s compliance estimate. UK Software Waste Index.
Where to go next
Related: Software stack, Per-seat pricing, Month-seven price