Introduction – The Hidden Cost of Unused SAP Licenses
Many enterprises own far more SAP licenses than they actually use.
In most large SAP environments, 10–30% of purchased licenses are sitting idle, delivering no value to the business. Each of these unused licenses still incurs about 22% of its value in annual support fees, quietly draining IT budgets. This “shelfware” is a hidden cost that accumulates year after year.
Unused SAP licenses are one of the easiest cost leaks to spot, yet among the hardest to eliminate. SAP’s contracts and policies make it challenging to remove or reassign licenses once they’re on the books. Read our comprehensive guide to SAP License Optimization Strategies: Cut Costs Without Cutting Value.
The vendor won’t volunteer that you have shelfware – it’s on the customer to find and address it. Every inactive license not only wastes maintenance spend but also inflates your compliance risk and renewal costs.
Recognizing this shelfware is the first step toward cutting out a costly 22% support tax on software you’re not even using. The key is to identify these unused licenses and take action despite SAP’s restrictive maintenance and reallocation rules.
What Is SAP Shelfware?
SAP shelfware refers to licenses you’ve purchased but aren’t actively using in your environment. They sit on the shelf (often literally in a contract or user list) but never see real utilization.
These could be entire software modules or individual user licenses. Common examples of SAP shelfware include:
- Named users who never log in: Employee accounts provisioned with SAP access that have no login activity.
- Modules procured but not implemented: For instance, purchasing SAP EHS or PLM as part of a suite but never deploying it to production.
- Duplicate licenses after mergers: When companies merge or reorganize, they often inherit overlapping SAP licenses that become redundant and unused.
All these scenarios result in licenses that generate ongoing costs with zero operational value. SAP software is not benign – it comes with a direct financial impact. The vendor still charges full maintenance on these idle licenses, typically 22% of the license price every year.
Quick formula: Annual Shelfware Cost = Total Unused License Value × 22%.
For example, if you have €2 million worth of SAP licenses sitting unused, they will cost about €440,000 per year in support fees. That’s pure waste. These costs recur annually unless you do something about the shelfware.
Over just five years, an unused €2 million of licenses will rack up €2.2 million in maintenance, exceeding the original license cost without any return on investment. Shelfware is essentially a hidden IT tax that erodes your budget and ROI, year after year.
How to Identify Unused SAP Licenses
Identifying shelfware requires a data-driven audit of your SAP environment. You need to combine SAP’s own license measurement tools with careful analysis and validation.
Follow these steps to uncover unused licenses:
- Pull User and License Data: Run SAP’s USMM (User Measurement) reports for each system to gather raw user and engine usage data. Consolidate these results in LAW 2.0 (License Administration Workbench) to get an enterprise-wide view. Extract a full list of all active named users and their assigned license types from your SAP systems.
- Analyze Usage Activity: Examine actual usage for each user. Use SAP’s user information system (transaction SUIM) or audit logs to check the last logon date and activity history for every named user. Flag any users who haven’t logged in for the past 90 days, 180 days, or more. Many might be former employees, contractors, or system accounts no longer needed. Cross-check these inactive accounts with HR records to ensure you’re not counting users on extended leave or seasonal break.
- Evaluate Module Utilization: Look at each SAP module or engine you’ve licensed and see if it’s being used. Identify modules that are installed but show no active transactions or data in the production environment. For example, if you purchased licenses for SAP EHS (Environment, Health and Safety) or a supply chain module, verify whether they have been used or if they were never implemented. Modules with zero or minimal usage are prime candidates for shelfware.
- Validate Against Entitlements: Compare your findings against your SAP contract entitlements. Do you have more licenses on paper than are active in the system? For instance, if you’re entitled to 5,000 Professional User licenses but only 3,800 users are actually active, that difference (1,200 users) represents potential shelfware. Perform this check for all license types and engines to spot any purchased capacity that isn’t being utilized. This step ensures you’re aligning technical usage with what you’re paying for.
After completing these steps, you will have a clear picture of which user accounts and modules are truly unused. It’s important to use both technical data and business validation (like HR input) so you don’t mistakenly label a needed account as shelfware.
Checklist: To summarize your shelfware identification process, make sure you have:
- Pulled the latest user/license data via USMM and LAW 2.0.
- Flagged users with no recent activity (e.g., 90+ days inactive).
- Identified licensed modules or engines with little to no usage.
- Cross-checked inactive users against HR to avoid false positives.
- Mapped actual usage numbers against your contract entitlements.
- Calculated the potential support cost savings from removing or reallocating each unused license.
Using this checklist ensures a thorough audit. A combination of SAP’s built-in tools and manual validation will give you defensible data on what licenses are shelfware.
The result is a list of candidates for reallocation, termination, or other optimization – along with the evidence to back it up.
Quantifying the Cost of Shelfware
Once you’ve identified unused SAP licenses, the next step is translating that into financial impact. This quantification is crucial for getting executive attention and building a business case to address the issue. The cost of shelfware can be calculated with a simple formula:
Annual Shelfware Cost = Unused License Value × 22% (SAP’s typical support fee rate).
Five-Year Shelfware Cost = Annual Shelfware Cost × 5 (to illustrate long-term impact).
For example, consider a company with €3 million worth of SAP licenses that are not being used:
| Unused License Value | Annual Support Cost (22%) | Cost Over 5 Years |
|---|---|---|
| €3,000,000 | €660,000 per year | €3,300,000 |
In this scenario, €3 million in shelfware costs about €660,000 every year in maintenance fees. Over five years, the company would burn €3.3 million on support for software that isn’t even in use – effectively paying more than the original investment just to keep it on life support.
This calculation can be done for any amount of shelfware to show the scale of waste.
Often, organizations are shocked to find that, for example, an unused €500,000 module will cost them about €110,000 each year (and €550,000 over five years) in pure support fees. Quantifying shelfware in this way turns an abstract waste into a concrete financial figure.
Also consider indirect savings and benefits of eliminating shelfware:
- Reduced audit risk: Clearing out unused licenses tightens your compliance position. You know exactly what you have and use, which reduces surprises in an SAP license audit.
- Lower future maintenance base: Removing or trading in shelfware can shrink the base on which your 22% support is calculated. That means lower support invoices after renegotiation or renewal.
- Higher ROI on SAP investment: By shedding licenses that provide no value, your metrics for SAP return on investment improve. You’re spending IT budget on what’s actually used, which is a win for efficiency and governance.
When presenting shelfware findings to stakeholders, highlight both the direct cost (e.g., “we’re wasting €X per year on unused licenses”) and these indirect benefits. This turns shelfware analysis into a compelling cost-saving initiative rather than just a technical cleanup.
Read more about optimization, SAP License Reallocation & Recycling: How to Maximize Utilization and Stop Buying Unnecessary Licenses.
Governance & Data Sources for Shelfware Analysis
Proactive governance is key to catching shelfware regularly, not just during crises or audits. To effectively monitor and minimize unused SAP licenses, leverage both technical tools and business data on an ongoing basis.
From a technical standpoint, make use of SAP’s own administration and monitoring tools. USMM and LAW 2.0 remain fundamental for user license tracking and consolidation of license data across systems.
SAP Solution Manager can help track engine usage and user stats as well. Additionally, many organizations use third-party Software Asset Management (SAM) tools (such as Snow Software, VOQUZ, or Aspera), which can automate the detection of inactive users and unused components in SAP. These tools can provide more user-friendly reports and even alert you to anomalies in license usage.
On the business side, integrate data from HR and IT service management. HR records help confirm whether “inactive” user accounts correspond to people who have left the company or changed roles.
Access management systems can verify if accounts are disabled or obsolete. Financial data (like cost center mappings) can attach a dollar value to each license, aiding in calculating those 22% costs for shelfware.
Shelfware analysis shouldn’t be a one-off project. Frequency is important: perform a dedicated shelfware audit at least once a year, and definitely before any major SAP contract renewal or true-up negotiation.
Regular annual reviews will catch new shelfware that creeps in due to staff turnover, project changes, or acquisitions. It also sends a message that your organization is actively managing its SAP spend.
Good governance means assigning clear ownership of this process. Typically, the IT Asset Management or Software Asset Management team (ITAM/SAM) will own the ongoing tracking of license usage. They should partner with procurement and SAP-based teams to ensure data is gathered accurately.
Governance checklist: As you formalize shelfware control, ensure the following governance practices are in place:
- Ownership: Assign a dedicated team (e.g., SAM or licensing manager) to monitor SAP license utilization and shelfware cleanup.
- Regular reporting: Establish standard reports or dashboards that show inactive users and unused modules in your SAP landscape. Review these reports quarterly or semi-annually.
- Finance alignment: Align with Finance on how you quantify shelfware costs (using the 22% rule or actual support rates) so that savings calculations are agreed upon. This helps in budgeting and in making the action case.
- Audit-ready documentation: Keep a record of all shelfware findings and actions taken (licenses terminated, reallocated, etc.). If SAP audits you, this documentation shows you’re managing licenses responsibly and can be used to contest any discrepancies.
By combining the right tools, data, and governance routines, you create an environment where shelfware is spotted early and dealt with proactively. This prevents long-term waste and ensures your SAP license inventory stays aligned with actual business needs.
Using Shelfware Data for Negotiation Leverage
Shelfware audits aren’t just an internal cost-cutting exercise – they can become a powerful tool in your negotiations with SAP. The data you gather on unused licenses can be used to push for better terms, credits, or reductions in your SAP agreements.
One leverage point is to request a reduction in the maintenance base. If you can show SAP that, for example, 15% of the licenses in your contract are not being used at all, you have a strong argument to remove those from the support contract or get a discount.
SAP historically has been reluctant to voluntarily cut maintenance revenue, but with hard data, you can make a case that continuing to pay full freight for shelfware is untenable. In some cases, customers have negotiated a give-back of unused licenses at renewal, resulting in a lower annual support bill in the future.
Another strategy is to swap unused licenses for new needs. SAP’s Cloud Extension Policy is one program that allows customers to convert the value of on-premise software into cloud subscription credits.
Similarly, you might negotiate to trade unused module licenses for other SAP products that your organization actually wants to use. Essentially, you leverage the sunk cost of shelfware as currency for something more useful – turning a waste into an investment.
Don’t forget to ask for support discounts or freezes based on underutilization. If you have concrete figures like “€X million of our SAP estate is shelfware,” you can propose a percentage reduction in the maintenance fees or a flat support credit.
Even a temporary maintenance fee freeze (no annual uplift) could be justified by pointing out that a chunk of the support you’re paying yields no benefit.
Always frame your ask with a quantified business case. For example, you might present it to SAP as:
“Our internal audit found that 15% of our user licenses (worth approximately €1.2 million) are inactive. We propose reducing our maintenance accordingly – this could be a 20% cut in annual fees or a credit of equal value towards new SAP solutions we actually need.”
In negotiations, this kind of precise shelfware data flips the script. Instead of SAP dictating terms, you have evidence to challenge the status quo.
At the very least, SAP account reps will know you’re aware of your usage and costs, which can make them more flexible in offering solutions (like allowing terminations or offering promotional credits).
The shelfware analysis essentially becomes leverage to optimize your contract, whether through reducing waste or funding new initiatives without extra budget. It shifts the conversation from just buying more to getting more value out of what you’ve already bought.
Common Pitfalls in Shelfware Identification
While identifying shelfware seems straightforward, several pitfalls can lead to mistakes or missed opportunities.
Be aware of these common errors when analyzing your SAP licenses:
- Pitfall 1: Misinterpreting “inactive” users. Not every user with no recent login is true shelfware. Some SAP user IDs perform background jobs or have API access without interactive logins. Fix: Don’t rely only on the last logon date; also check transaction usage and job logs. Confirm that an account is genuinely not in use (or tied to a departed employee) before classifying it as shelfware.
- Pitfall 2: Double-counting across systems. In complex SAP landscapes, the same individual might have accounts in multiple systems (ERP, BW, CRM, etc.). If you simply sum up inactive users from each system, you could count the same person multiple times. Fix: Use LAW or another consolidation method to de-duplicate user counts across the landscape. Identify unique users to avoid overstating shelfware.
- Pitfall 3: Failing to reconcile with HR data. Technical usage data alone might flag a user as inactive, but perhaps that person is on long-term leave or a contractor between assignments. Writing them off as shelfware could be a mistake if they return. Fix: Always cross-reference potential inactive users with HR and department managers. This ensures you only target truly obsolete accounts (e.g., employees who left) for removal.
- Pitfall 4: Not linking software to financials. Sometimes, IT teams identify unused licenses but stop at the technical count. This misses the impact. Fix: Translate every piece of shelfware into a monetary cost (using the maintenance rate). For instance, don’t just report “100 unused licenses,” report “100 unused licenses costing €50,000/year in support.” Attaching currency values makes the issue real for business leaders and drives action.
By anticipating these pitfalls, you can refine your shelfware analysis and avoid false conclusions. The goal is to get an accurate, business-relevant picture of unused licenses, so you can confidently act on it.
Practical Example – Quantifying Real Savings
To illustrate the impact of a shelfware cleanup, consider a real-world example. A multinational energy company conducted an SAP license audit and discovered that 1,000 Professional User licenses had no activity for over 180 days.
These unused licenses were valued at roughly €5 million. The finding was eye-opening: the company had been paying about €1.1 million per year in maintenance for these 1,000 users (including annual support uplifts), without any business usage.
Armed with this data, the company took decisive action. It worked with SAP to remove the truly unused user licenses from their maintenance base and negotiated credits that could be applied to future SAP investments.
The immediate outcome was a €1.1 million annual savings on support fees. In addition, by cutting out that shelfware, they avoided incurring further cost increases on those licenses and reduced their risk exposure in an audit.
This example shows how a targeted software audit can translate directly into significant financial savings. The company not only freed up over a million euros yearly (money that could be reallocated to new projects or technologies), but it also demonstrated strong IT governance to its stakeholders.
It reinforced that keeping a close eye on license utilization pays off, both in cost control and in ensuring compliance records are up to date. It’s a clear win-win: less waste and tighter control over the SAP environment.
5 Shelfware Reduction Tactics to Remember
- Use SAP’s tools to pinpoint inactivity. Regularly run USMM and LAW 2.0 to find inactive users and unused engines across all systems. These tools are your starting point for identifying shelfware.
- Align usage with entitlements. Continuously map actual system usage to what you’re entitled to under your SAP contract. This highlights any surplus (licenses paid for but not used) that can be targeted.
- Quantify the 22% maintenance drain. Always calculate the cost of each unused license using the 22% annual support rate. Present shelfware in financial terms (e.g. “this module costs €100K/year in support”) to drive home the urgency.
- Bake shelfware audits into governance. Make shelfware review a yearly ritual in your SAP management calendar, especially before renewals. Routine checks mean you catch idle licenses early and avoid years of accumulated waste.
- Leverage shelfware data in negotiations. Use your audit results as bargaining chips – push for maintenance reductions, license swaps, or credits. Don’t let SAP renew contracts on autopilot when you have evidence to demand a better deal.
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