Introduction – Why Benchmarking SAP Uplift Matters
SAP’s annual support and subscription price increases may look modest – often around 3–5% – but those small percentages carry weight against industry norms. What seems like a routine “inflation adjustment” can actually exceed real inflation in many markets.
Many customers assume a 3–4% uplift is simply standard practice. They may not realize that some competitors raise prices much less – or not at all – over the same period.
This is why benchmarking your SAP uplift matters. It’s the only way to tell if SAP’s increases are justified or out of line. Without benchmarking, you might accept SAP’s yearly rate as “normal” – and pay dearly for it.
By comparing your price hikes against peers and industry norms, you gain hard evidence of what’s reasonable. Benchmark data becomes a commercial weapon in renewals.
It arms you to push back on excessive uplifts instead of passively taking SAP’s rate.
Read our comprehensive guide to SAP Price Uplifts & Renewal Tactics: Keeping Cost Increases in Check.
Understanding Benchmarking in the SAP Context
In an SAP renewal, benchmarking means measuring your deal’s annual price increase against relevant standards. It involves comparing your uplift rate, pricing structure, and terms with similar SAP customers, broader industry averages, and other software vendors.
For example, peers in your region or sector might have negotiated annual uplifts in the 1–3% range – establishing a realistic target for you.
In general, industry norms for enterprise software support tend to be lower than what SAP is asking.
Some vendors (like Oracle, Microsoft, or Salesforce) apply smaller increases or even freeze fees in multi-year deals. That’s a stark contrast to SAP’s routine 3–5% yearly hike.
SAP often ties its support fee increases to inflation indices. But this model can overshoot what peers experience, especially in low-inflation markets. A built-in 5% annual uplift in a low-inflation environment is aggressive.
To benchmark properly, first dissect your contract. Know exactly how your uplift clause works – is it pegged to CPI, a fixed percentage, or just “SAP standard”? Then evaluate that against economic reality and industry practice.
Checklist:
- Identify your contract’s uplift clause (e.g., CPI-linked, fixed % per year, or “standard SAP rate”).
- Compare SAP’s chosen rate or index vs. your local CPI. Is SAP’s increase higher than actual inflation?
- Map out how many years you’ve accepted annual uplifts without review. A long unchallenged streak could mean you’re overdue for a reset.
Typical SAP Uplift Rates vs Industry
How do SAP’s annual increases stack up against the rest of the enterprise software world?
The table below compares typical yearly uplifts for SAP and other major vendors’ support or subscription fees:
| Vendor & Support Type | Typical Annual Uplift | Notes |
|---|---|---|
| SAP Enterprise Support (on-prem) | 3–5% | Tied to CPI in many contracts, often capped by region (e.g. max 5% annually) |
| SAP Cloud Subscriptions | 2–4% | Often fixed in multi-year renewal clauses; if no cap, standard uplifts apply |
| Oracle Premier Support | 3% | Standard inflationary increase (historically around 3% each year) |
| Microsoft Support / CSP | 0–2% | Usually CPI-based if applied; often 0% in multi-year enterprise deals |
| Salesforce Cloud | 0–5% | Highly negotiable at renewal – some customers see no increase with long-term commitments |
SAP’s uplift range sits at the high end of this spectrum. A 3–5% yearly increase might be routine for SAP, but it isn’t universal practice across the industry.
Many software providers give loyal customers smaller or no annual increases, especially when inflation is low.
Over the long term, SAP’s steady 5% hikes compound far more than the gentler adjustments seen elsewhere. In short, SAP’s “standard” uplift exceeds typical industry norms – a gap you can exploit in negotiations.
The Compounding Effect of Uplifts
Even small annual uplifts can snowball into a major budget hit over time. Consider a base support cost of €10 million in year one. If that cost grows at 3% per year versus 5%, here’s how the difference adds up:
| Year | Base Support (€M) | 3% Annual Uplift | 5% Annual Uplift |
|---|---|---|---|
| 1 | 10.0 | — | — |
| 2 | 10.3 | +0.3 M | +0.5 M |
| 3 | 10.6 | +0.6 M | +1.0 M |
| 5-Year Total | — | +1.6 M | +2.8 M |
Over five years, a 3% uplift adds roughly 16% to your support costs, whereas 5% adds nearly 30%. That difference can equate to millions of euros on a large contract.
Benchmarking these effects reveals the true long-term cost behind SAP’s percentage increases.
What SAP calls a minor yearly adjustment actually locks in significant cost escalation. It reframes the conversation from “just a few percent” to the very real euros and dollars at stake.
Read more about SAP annual increase rates, SAP Annual Uplift Rates: Understanding On-Prem & Cloud Support Increases.
How to Gather Benchmark Data
Effective benchmarking starts with gathering the right data. Begin internally: review your past SAP contracts and renewal history.
Note when SAP introduced uplift clauses and how those terms have changed over time. Also, look at any divisions or subsidiaries – if they have separate SAP agreements, compare their uplift terms.
Next, seek outside reference points. Try to obtain anonymized data on peer companies’ SAP renewals (through industry groups or advisors).
Check economic indicators too. How do local CPI rates compare to the percentage SAP applied? If SAP raised fees by 4% in a year when inflation was only 2%, that’s a red flag.
Stay aware of SAP’s public statements as well – in some year,s they announce regional caps (for example, a 5% maximum increase) which can guide your benchmarks.
Once you have these data points, analyze them for patterns and outliers. The goal is to see clearly where your deal stands relative to the norm.
Checklist:
- Gather 3–5 solid data points from comparable SAP customers or contracts to define your benchmark range.
- Normalize your comparisons for geography and inflation differences (a 4% hike in a country with 1% inflation is a bigger leap than it looks).
- Identify any outlier terms in your deal – e.g., a higher-than-usual fixed uplift or lack of a cap – and flag those as negotiation levers.
How to Use Benchmarks in Negotiation
Having benchmark data is only half the battle. The next step is to use it to challenge SAP’s proposal and secure better terms. Approach your renewal discussion with facts and a clear strategy:
- Present your benchmark findings. Start by showing how SAP’s proposed uplift compares to the market. For example: “Our peer benchmark shows 2–3% annual uplift as the norm for similar contracts. SAP’s proposed 5% rate is above industry norms.” This opens the conversation with an evidence-based anchor.
- Request justification for SAP’s number. Don’t accept a high uplift without an explanation. Prompt SAP to defend it: “Can you demonstrate how a 5% increase aligns with actual inflation and the value we’re getting? Our data shows inflation is around 2.4%.” Make SAP work to rationalize its rate.
- Counter with a data-backed proposal. Leverage your benchmarks to suggest a fair alternative. For example: “Given the market data, we propose capping annual increases at the EU CPI rate (~2.4%) instead of a flat 5%.” By offering a concrete counter tied to a credible index, you appear reasonable and firm.
For SAP, a 5% hike might be presented as “standard policy.” By using your benchmark data, you reframe the story – now it’s “this is above market and needs adjustment.”
Throughout the negotiation, frame your requests in commercial terms rather than technical ones. It’s about dollars and sense, not support entitlements or service details.
Checklist:
- Double-check all your figures and assumptions before talks. You want to be sure your benchmark facts are rock-solid when you cite them.
- Keep the discussion focused on business value and fairness. If a sales rep resists, consider escalating to a commercial director – price terms often need higher approval.
- Always anchor your position with your data. When SAP sees you have done your homework, they’re more likely to bend on “standard” uplifts.
Benchmarking for Cloud vs On-Prem Customers
SAP customers should benchmark uplifts differently for on-premise licenses versus cloud subscriptions, because the dynamics vary:
For on-premise software, annual support fees are typically about 22% of the license price, and SAP usually applies an uplift of around 3–5% on that support fee each year.
This might seem like a fixed policy, but even “policy” uplifts can be negotiated or capped with the right leverage.
For cloud subscriptions, contracts often include an automatic 2–4% increase in fees each year. The twist is that at renewal time (usually every 1–3 years), the price can jump higher if no cap is in place.
The good news is these cloud escalations can be more flexible than SAP’s boilerplate terms imply. Many customers have quietly negotiated CPI-linked caps or even fixed pricing for several years on cloud renewals, despite what SAP’s standard clauses say.
Checklist:
- Benchmark your cloud and on-prem uplifts separately. Don’t let a high increase in one area justify a high increase in the other.
- Align contract timelines where possible. Co-term your cloud and on-prem renewals so you can negotiate all uplifts at once, with a unified cap across the board.
- Push SAP to harmonize policies. If your maintenance uplift is capped at 3% but cloud fees are rising 5%, point out the inconsistency and insist on a fair alignment.
Read when to start your negotiation, Optimizing SAP Renewal Timing: Renew Early or Wait for Year-End Pressure?.
Using Industry Data to Justify Your Counteroffer
When it’s time to propose your counteroffer, structure your case with comparisons. Show SAP how your request lines up with market reality. For example:
| Aspect | SAP’s Standard Uplift | Industry Benchmark | Your Target Offer |
|---|---|---|---|
| On-Prem Support (ES) | 3–5% per year | ~2–3% per year | ≤ 3% (tied to CPI rate) |
| Cloud Subscription Fees | 2–4% per year | ~1–2% per year | ≤ 2% (or multi-year freeze) |
| Combined Renewal | ~4% blended average | ~2–3% per year | ≤ 3% global cap on all services |
By laying out SAP’s ask versus the benchmarks and your proposal, you make it clear your counter isn’t arbitrary – it’s grounded in market norms.
This approach makes it much harder for SAP to dismiss your position. You’re signaling that you know what other customers and vendors consider reasonable.
Action Tip: Benchmark your own SAP deals regularly (at least every two years). SAP’s idea of a “standard” uplift can evolve faster than inflation. Regular benchmarking ensures you catch creeping increases and have data ready for your next negotiation.
5 Benchmarking Insights to Strengthen Your SAP Renewal
- SAP uplifts are negotiable. Even if SAP claims an increase is policy, many peers have secured lower caps or even zero-uplift periods by pushing back.
- Separate cloud vs on-prem benchmarks. Don’t accept a high cloud uplift just because your on-prem was high (or vice versa). Benchmark each one independently, since SAP often treats them separately.
- CPI-based uplifts don’t always reflect real inflation. If SAP pegs increases to an index, make sure the timing and % actually match your local economy. If not, demand alignment to true inflation data.
- Use peer data to counter “SAP standard” claims. When SAP says “everyone pays this,” your benchmark data can prove otherwise. Leverage those comparisons to challenge any so-called standard rate.
- Build an internal benchmark library. Track your own and others’ uplift outcomes over time. By your next renewal, you’ll have evidence of what’s achievable, which strengthens your position and confidence.
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