How to Minimize Internal Costs with Software Licensing

One of the issues that companies often run into when providing software services is the hurdle that is licensing. Licensing issues have plagued businesses since the dawn of software, as it's challenging to think about licensing and ownership when you have to consider every customer's unique situation.

It's not the kind of thing to be taken lightly, as issues with licensing can quickly lead to legal troubles if left unchecked. You could also suffer from problems such as software piracy if you're too lax with how you control your software. As if that wasn't enough, internal costs can quickly balloon if you don't deal with licensing as soon as possible.

Here are some steps you can take to minimize overall internal costs with software licensing.

1.  Utilizing data management software for automation

There are various types of data management software you can use to help minimize costs when licensing software, with one excellent example being entitlement management. It's a good idea to prepare your business endeavors for automation by going for management platforms, as it can optimize your company in more ways than one. In addition, it keeps everyone on the same page and makes it much easier to manage your business.

Another example of data management done right is using cloud computing software to allow one's business to be managed on the go. With the help of cloud-based services, company owners can manage their business from the comfort of their homes—that's how modern tech and business dynamics have grown over the years. Without a doubt, it will minimize costs for licensing as your business shifts to automation.

2.  Use the subscription-based model

While there are many types of software licensing available for vendors, it’s best to go with the one that has had the most success with end users. In the case of software, it’s undoubtedly the subscription-based model. Game companies have been using the subscription model for many years and have achieved a mind-boggling amount of success. All you’d have to do is look into the history of the MMORPG and the growth of games such as World of Warcraft to figure out the benefits of the subscription-based model.

One great part about the business model is it gives more control to the customer, allowing them to pay only for what they intend to use. This flexible model will improve your company’s revenue stream and minimize licensing costs.

3.   Adding a free trial to the mix

If there’s one thing you can add to a subscription-based model that can further improve your relationship with end users, it’s a free trial. While companies might not want to hear the term ‘free,’ keep in mind that you’re trying to foster loyalty to the brand over everything else. If you don't offer a bit of goodwill in the form of a free trial, you won't get nearly as many people trying your software.

Software licensing can be a challenge for even the most seasoned business owner, which is why it’s a good idea to focus on the best business models for your company and its end users. The best-practice methods above are sure to help.

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