SAP True-Downs & License Transfers: Reducing Your License Footprint

sap true downs & license transfers

Introduction – Why True-Downs Are a Critical Negotiation Lever

Once SAP licenses are purchased, they tend to live forever on your books — unless you negotiate a way out.

Many enterprises overbuy SAP licenses during ambitious growth or digital transformation projects. Later, when the business restructures or moves to the cloud, they find themselves with a bloated license portfolio and thousands of unused licenses (shelfware).

The problem: SAP’s contracts make it extremely difficult to return or terminate licenses you no longer need. There is no built-in right to scale down your entitlements when usage drops.

SAP’s standard stance is “no returns, no refunds” on perpetual licenses. As a result, customers keep paying annual maintenance (typically 22% of license cost) on software that nobody is using.

This is why “true-downs” have become a critical negotiation lever. A true-down means formally reducing your SAP license counts (users or engines) and the associated maintenance fees. It’s not an entitlement given freely by SAP, but rather an art of negotiation.

With the right timing, leverage, and justification, organizations can convince SAP to accept a license reduction.

The goal is to right-size your SAP investment – you pay for what you actually use, not what you used to use. True-downs require careful planning and strategy, but they can save millions and align costs to reality.

(In this guide, we’ll explore when and how SAP license reductions are possible, what SAP’s default position is, and how you can successfully negotiate a smaller license footprint without breaching contracts or losing critical rights.)

Defining SAP True-Downs – What They Are and Why SAP Resists

A “true-down” is the process of formally reducing the number of SAP licenses under your agreement and lowering the maintenance base accordingly.

In other words, you return some unused licenses to SAP or terminate support on them so you no longer pay for them. True-downs typically happen at major contract milestones (like a renewal or enterprise agreement restructuring) because SAP usually won’t entertain mid-term reductions.

Why SAP Resists True-Downs: SAP sells perpetual licenses, meaning once you buy them, you own the rights forever. From SAP’s perspective, all sales are final – licenses are non-refundable and non-returnable. By default, SAP will continue charging you maintenance on every license you purchased, even if it’s sitting idle.

The vendor’s standard policy is that you cannot simply drop licenses and pay less maintenance unless SAP agrees as part of a special negotiation. SAP’s reluctance is largely financial: support fees (about 22% per year on license list price) are a huge profit source, and allowing reductions cuts into that revenue.

Therefore, true-downs are only considered in exceptional cases, usually when a big contract renewal or product transition is on the table (and even then, SAP will seek something in return).

Customer Implications of “No Reduction”: If you never negotiate a true-down, there are two major impacts:

  • You keep paying maintenance on unused licenses indefinitely – essentially throwing money away on shelfware year after year.
  • You carry inflated entitlement counts that can skew future audits and renewal discussions. (For example, having far more licenses than you use might complicate compliance positions or give SAP leverage to upsell new products instead of reducing costs.)

For these reasons, savvy customers treat true-downs as a key part of license optimization. It starts with understanding your own usage and shelfware:

Checklist: Identifying Shelfware for Potential True-Down

  • Identify current vs. actual usage: Inventory all SAP users and engines you’re entitled to versus what is actually in use.
  • Map entitlements to system usage reports: Use SAP’s measurement tools (USMM, SLAW) or internal audits to see how many users/logins or engine capacity are actively consumed.
  • Flag licenses with zero or low activity (12+ months): Any license type not used in a year or more is a prime candidate for reduction. These are costing you fees with no business value.

When True-Downs Become Necessary

How do you know it’s time to push for a true-down? There are a few common triggers where license reductions become not just attractive, but necessary:

  • Restructuring or Workforce Reduction: If your company’s headcount shrinks (through layoffs, outsourcing, etc.), you likely have fewer SAP users. A 20% reduction in employees might translate to 20% of named user licenses now sitting idle.
  • Technology Consolidation: Perhaps you retired legacy systems or moved certain functions off SAP to another solution. For example, if a CRM module was replaced by Salesforce, the SAP CRM user licenses are now candidates for termination.
  • Cloud Migration: Moving to cloud offerings (like RISE with SAP or other SaaS) can make on-premise licenses redundant. As you migrate users to SAP cloud subscriptions, the equivalent on-prem licenses turn into shelfware unless you negotiate to swap or terminate them.
  • Shelfware Discovery: Regular internal audits or SAM tools might reveal large numbers of licenses that are provisioned but not actually used. Sometimes, an SAP system measurement (LAW report) uncovers that, say, 30% of your licensed Professional Users haven’t logged in for a year. This discovery should prompt action.

Example Scenario: A global retailer underwent a major downsizing, cutting its workforce by 20%. However, it continued paying maintenance on about 4,000 SAP Professional User licenses that were no longer in use, resulting in an excess cost of roughly €1.5 million per year in support fees.

These licenses sat on the books as shelfware until the company finally negotiated a partial license termination at their next renewal. By executing a true-down, they eliminated those unused 4,000 licenses from their contract and immediately stopped the €1.5M annual waste.

When any of these situations occur, a true-down discussion with SAP moves from “nice-to-have” to essential.

Timing is key: you typically must wait for a renewal or licensing agreement renegotiation window to enact changes. But you can prepare well in advance.

Checklist: Preparing for a True-Down

  • Assess system and business changes: Document any shifts in your landscape (mergers, divestitures, process changes, cloud projects) that reduce license needs.
  • Identify redundant licenses: Pinpoint which users or modules are now redundant due to those changes (e.g., after a merger, you might have overlapping ERP licenses).
  • Gather utilization evidence: Compile data showing usage drop-off – solid evidence (usage logs, user counts) strengthens your case that those licenses are truly unnecessary.

SAP’s “No Returns” Policy and Its Commercial Reality

SAP’s contract language is famously rigid: “All license purchases are perpetual and non-cancelable. Maintenance for licensed software is likewise non-cancelable during the term.”

In plain terms, SAP’s standard “no returns” policy means you cannot return licenses for a refund, and you’re expected to keep paying support as long as you use SAP. From a legal standpoint, once you buy it, you own it and must carry it.

However, the commercial reality is more nuanced. SAP is resistant to outright returns, but they will come to the table if there’s a larger deal or incentive at play:

  • License Rationalization tied to New Spend: In practice, SAP may consider a license reduction if you are making a new investment in SAP at the same time. For example, suppose you’re purchasing additional SAP cloud services or upgrading to S/4HANA. In that case, SAP might allow some existing on-prem licenses to be terminated or credited as part of the overall deal. They won’t refund money, but they might let you stop paying maintenance on certain software licenses if you, say, commit to a new cloud subscription of equal or greater value.
  • Maintenance Reduction via Trade-Offs: Some customers have negotiated maintenance fee relief or credits by agreeing to future spending. Instead of SAP writing a check back (which they won’t), they might give you a credit that you can use toward new licenses or cloud services. Essentially, you “trade in” the unused licenses as currency for something else.
  • True-Downs Disguised as Deals: Any license reduction you achieve will often be packaged as a broader commercial deal, not an official policy exception. SAP might never formally say “we’re letting you return licenses,” but they might structure your renewal such that X licenses are removed. You simultaneously buy Y new licenses or services. Internally, SAP can justify it as part of customer retention or cloud transition, rather than setting a precedent of refunds.

The key for customers is to frame the true-down request in a way that aligns with SAP’s interests. You must tell a story where both sides win – you get to reduce shelfware, and SAP gains something (continued loyalty, new product adoption, revenue security) from it.

Negotiation Framing Example: When approaching SAP, position your ask within a positive, forward-looking plan. For instance:

“We’re restructuring our business. To stay aligned with actual usage, we need to reduce 2,000 Professional User licenses and in return we’re prepared to redirect part of the saved maintenance into a SuccessFactors subscription for our HR modernization.”

In this example, you’re not just asking SAP to cut your fees; you’re proposing to reinvest some of the savings into a new SAP solution. This gives SAP a value-add narrative to justify the reduction internally.

Checklist: Strengthening Your True-Down Negotiation

  • Fit the SAP Narrative: Frame your reduction request as part of a transformation or value initiative (e.g., moving to cloud, adopting new SAP products) rather than just cost-cutting.
  • Propose a Trade or Swap: Be ready to offer something in exchange – for example, cloud credits, license swaps, or a longer-term commitment. This quid pro quo can make SAP more receptive.
  • Get it in Writing: If SAP agrees to any license reductions or maintenance adjustments, insist on documenting it in the contract or amendment. Verbal assurances are not enough – you need the new, lower license counts and fees officially recorded.

License Transfers – What’s Allowed and What’s Not

Another strategy to reduce your SAP footprint is through license transfers, but SAP tightly controls this area. It’s critical to understand what kinds of transfers are allowed within the rules and which are forbidden:

  • Internal Transfers (Within Your Corporate Group): Transferring licenses internally, such as between divisions or affiliated companies under the same corporate umbrella, is generally allowed in principle. If your SAP contract defines the “Licensee” to include the parent company and its wholly-owned subsidiaries, then those affiliates can use the licenses. You can reallocate unused licenses from one business unit to another within the same organization without purchasing new licenses. However, you must usually notify SAP of such internal transfers and ensure your license records (user assignments, installations) are updated. This is more of a license management exercise – it won’t reduce the total number of licenses. Still, it can maximize their usage across your enterprise so you’re not buying duplicate licenses for different subsidiaries.
  • External Transfers (Resale or Third-Party Transfers): Selling or transferring SAP licenses to another company is strictly prohibited under standard SAP agreements. Almost every SAP contract has a “no resale” or non-transfer clause, meaning you cannot resell your perpetual licenses or hand them off to an unrelated third party. Even in the European Union, where court rulings have established the right to resell used software, SAP has effectively thwarted this in practice. They do not acknowledge or facilitate license resales, and without SAP’s cooperation, an external transfer is practically impossible. So, for all intents and purposes, you’re stuck with those licenses unless SAP agrees to terminate them; you cannot auction off surplus SAP licenses to another company.
  • M&A Scenarios (Mergers, Acquisitions, Divestitures): In corporate transactions, license transfer issues become complex:
    • In a Merger where two SAP-using companies combine, you can’t just merge their licenses like bank accounts. SAP will require the consolidation of contracts under one surviving entity. You might end up with overlapping entitlements (duplicate license types from each side). While internal use across the newly merged group is acceptable, formally combining contracts requires SAP’s consent and often involves a contract consolidation process. This is a chance to negotiate – ideally, eliminate redundancies and negotiate a true-down of duplicate licenses when merging agreements.
    • In a Divestiture or Spin-off, where part of the company is carved out, the separated entity cannot take a portion of the licenses with it by default. All licenses remain with the original license-holder (typically the parent company). The spun-off business has no direct rights to use SAP going forward unless you negotiated an exception. SAP typically requires the new entity to purchase its own licenses. Sometimes transitional use is allowed via a Transition Services Agreement (TSA), where the parent runs SAP for the spun-off unit for a limited time post-separation. Still, ultimately, the new company must get its own contract. The parent is then left with potentially too many licenses (since some users/businesses left) – another driver to negotiate a true-down.
    • In a Business Unit Sale, if you sell a division to another firm, SAP licenses do not automatically transfer to the buyer as part of the sale of assets. The software license is not like a piece of equipment; it’s bound to the original customer. The buyer will need to acquire new licenses for the SAP software to legally operate that business unit after the sale. The cost of re-licensing should be factored into the deal. As the seller, you might end up with excess licenses once that unit is gone, which again puts you in a position to request a reduction.

Example Contract Clause:

Most SAP agreements contain wording such as: “Licenses are non-transferable except to wholly-owned affiliates of Customer. Any assignment or transfer of this Agreement or the licenses requires SAP’s prior written consent.”

This kind of clause means you can move licenses around within your own corporate family (parent and subsidiaries), but not outside of it without permission.

Checklist: Managing License Transfers and Changes

  • Review the Assignment/Transfer Clauses: Go through your SAP contracts and note what they say about transferring or assigning licenses. Understand the boundaries SAP has set in your case (some contracts might even restrict affiliate use if not properly worded).
  • Plan for M&A: If you anticipate a merger or divestiture, involve SAP early. It’s better to negotiate how licenses will be handled before the transaction is finalized. Early notification can sometimes open options like contract carve-outs or combined licensing agreements to ease the transition.
  • Ensure Support Continuity: If part of your company is splitting off or merging in, make sure both the remaining business and the new entity have a plan so that SAP support isn’t interrupted. This might involve a short-term agreement where one company provides SAP access to the other during a transition, with SAP’s knowledge.

M&A and Corporate Restructuring Scenarios

Let’s look at a few common M&A licensing scenarios and how they typically play out in terms of SAP licenses:

Scenario 1 – Company Merger: Two companies using SAP merge into one. Now you have two sets of SAP entitlements under two contracts. The challenge is often duplicate license types and paying maintenance twice for overlapping capabilities. The best approach is to consolidate into one master agreement with SAP.

During this consolidation, negotiate to eliminate redundant licenses (e.g., if each company had 500 licenses of the same module, you might not need all 1,000 in the combined entity). Use the merger as leverage to true-down any overlap and ensure the merged contract gives you credit or removal for those duplicates instead of simply stacking them.

Also, watch out for losing volume discount tiers if contracts merge – try to preserve or improve your discount based on the combined volume.

Scenario 2 – Company Split (Divestiture/Spin-Off): A company splits into two independent entities. Only one is the original licensee under the SAP contract; the other is essentially a new company with no direct rights to SAP. SAP’s usual stance is that licenses cannot be split between the two – the contract stays with one side (often the side that retains the larger portion of the business or the original company name).

The other side will need to negotiate a new contract for its operations. To avoid chaos, companies should negotiate license assignment rights upfront if a split is anticipated. Without that, the safest path is a Transition Services Agreement, where the original company continues to provide SAP access to the new entity for a short time post-separation, allowing the entity time to implement its own SAP system or re-license.

Planning license ownership and usage boundaries before the split is critical to avoid compliance breaches (e.g., the new company inadvertently using SAP without a license). If you’re the parent company, you’ll likely have excess licenses after the spin-off – prepare to discuss a true-down with SAP so you’re not stuck paying for users that moved to the new company.

Scenario 3 – Business Unit Sale: A division or unit using SAP is sold off to another company. In this case, SAP licenses do not “follow” the sale. The selling company (original SAP customer) retains the licenses, but if that division was a big part of their user base, those licenses become unused after the sale. The buying company cannot just take over those licenses; they must acquire their own from SAP. This often comes as a surprise cost in M&A deals.

Smart buyers and sellers will factor in SAP re-licensing fees into the deal negotiations. From the seller’s perspective, after the sale, they now have a bunch of licenses for users or systems that they no longer have. The seller should approach SAP to adjust their license counts downward (true-down) or possibly transfer some licenses to the buyer if SAP is willing (which usually involves a fee or new purchase by the buyer anyway).

Often, SAP prefers to treat the buyer as a new customer and sell fresh licenses. So the seller might end up terminating support on the now-unused licenses to save costs.

Bottom line: in any business unit sale involving SAP environments, plan for how licenses will be handled – it’s not automatic.

Checklist: Navigating SAP Licensing in M&A

  • Due Diligence: Before a merger or divestiture is finalized, review all SAP contracts of the entities involved. Identify any clauses that could affect combining or splitting licenses.
  • Map Licenses to Business Units: Determine which licenses are used by which part of the business. This helps in deciding how to allocate or eliminate licenses post-transaction.
  • Negotiate Transitional Use: Work with SAP to arrange any necessary temporary access agreements (e.g., the seller runs SAP for the buyer for 6 months) to avoid business disruption. Make sure this is formally allowed to avoid compliance issues.
  • Post-M&A True-Down: After the dust settles, promptly engage SAP to adjust license counts. Whether merging or splitting, your needs have changed – this is an opportunity to optimize and not pay for unused capacity.

SAP Programs That Enable Downsizing or Restructuring

SAP historically has been strict about not letting customers reduce licenses. However, in recent years, they’ve introduced a few programs and policies to facilitate downsizing or restructuring in specific contexts.

These are often tied to moving customers into newer products or the cloud, which is in SAP’s interest. Here are some notable programs:

SAP ProgramWhat It DoesBenefit to Customers
Cloud Extension PolicyAllows customers to terminate on-premise license maintenance for certain products if they purchase equivalent SAP cloud subscriptions. In essence, you trade in unused on-prem licenses and get credit towards cloud services.You can reduce your maintenance spend on shelfware while funding a move to cloud solutions. It’s a way to modernize (e.g. switch to SaaS) without double-paying for old and new systems.
RISE with SAP ConversionPermits customers to leverage existing license investments when migrating to RISE with SAP (SAP’s SaaS offering for S/4HANA and related services). SAP may credit a portion of your on-prem license value or allow a flexible conversion of users into RISE subscriptions.Facilitates cloud migration by recognizing prior investments. You don’t feel like you’re throwing away all your sunk license costs because some of that value is carried into the RISE subscription deal, effectively reducing the net new cost.
License Conversion ProgramsSAP occasionally offers conversion programs to swap older license metrics or products for newer ones. For example, exchanging old ERP user types for the newer S/4HANA user categories, or converting unused modules into a different product license. These usually happen during a big upgrade or contract renegotiation.License optimization opportunity: you can eliminate unused or outdated licenses by converting them into something more useful. This simplifies your portfolio (perhaps moving to named user licensing from concurrent, etc.) and can remove shelfware as part of the swap.

These programs are not automatically granted; customers often have to qualify or negotiate inclusion in them.

They typically come with conditions – for instance, the Cloud Extension Policy usually requires a certain minimum investment in cloud and may only apply to equivalent functionality (you can’t trade any random license; it must be in the policy’s scope). Similarly, RISE conversion deals are case-by-case and tied to signing a RISE contract.

The benefit of these programs is that they provide a sanctioned path to reduce on-premise licenses or maintenance. SAP frames it as helping customers move to modern platforms while not paying twice. From your perspective, it’s a way to clear out excess inventory in exchange for committing to SAP’s strategic products.

Checklist: Considering SAP’s Optimization Programs

  • Check Eligibility: Discuss with your SAP account manager if you qualify for the Cloud Extension Policy or any conversion program. There may be specific timing windows or product scopes.
  • Quantify Trade-In Candidates: Identify which on-prem licenses would be traded or terminated if you pursued one of these programs. Calculate how much maintenance costs represent (so you know your potential savings).
  • Compare TCO: Weigh the total cost of ownership of moving to the new model (e.g., cloud subscription) versus staying with existing licenses. Make sure the program genuinely saves money and isn’t just a swap of expenses. Sometimes these deals make financial sense only if you were planning to move to the cloud anyway.

How to Build a Successful True-Down Case

Securing a true-down from SAP requires more than just asking. You need a well-prepared business case and negotiation strategy.

Here’s how to stack the odds in your favor:

  • Quantify Unused Licenses: Start by getting hard data on your software. Use SAP’s user measurement tools (USMM/LAW) or your own analysis to find exactly how many of each license type are not being utilized. For example, identify that “3,000 of our 10,000 Professional User licenses have had no login activity in 9 months.” This quantification is the foundation of your argument.
  • Document the Business Rationale: Clearly explain why these licenses are no longer needed. Perhaps your company downsized, divested a division, or migrated certain processes off SAP. Tie the license reduction to a legitimate business change or strategy. For instance, “Module X is being retired next year, so 500 associated user licenses will become excess.” SAP is more receptive if there’s a logical story, not just “we want to cut costs.”
  • Engage Early (Timing is Crucial): Don’t spring a last-minute request. Begin the conversation with SAP at least 6–9 months before your contract renewal or maintenance period ends. This gives time for pushback, escalation, and creative deal-making. If you wait until a few weeks before renewal, SAP reps will have little incentive or time to accommodate a reduction.
  • Leverage Relationships & Align Internally: Involve your SAP account manager and even SAP’s legal/commercial team early, signaling that this is a serious issue for you. At the same time, make sure your own stakeholders (CIO, CFO, procurement, etc.) are aligned on the plan and priorities. An executive-to-executive dialogue (CIO to SAP regional manager) about optimizing licenses can add pressure. Use any influence you have – references, user group feedback, or hints that you might consider third-party support or alternative solutions – to underscore that you need a flexible outcome.
  • Offer Value (Carrot vs. Stick): As discussed earlier, be prepared to offer something in exchange. It could be a commitment to a new SAP project, an upsell, or at least a longer renewal term for the remaining licenses. Present the true-down as part of a bigger partnership refresh with SAP, rather than a purely one-sided request.

Example Negotiation Strategy: To illustrate how you might wrap these elements together, consider a statement like:

“We’ve identified 3,000 inactive users in our legacy ECC system that we will decommission. We propose to terminate those licenses at renewal, and in exchange, we are evaluating an investment in SAP BTP (Business Technology Platform) – but that investment is contingent on getting our base right-sized. In short, we’d redirect part of the €X million maintenance we save into new SAP solutions that support our future roadmap.”

This approach combines data (3,000 inactive users), a business change (decommissioning a system), early notice (proposing at renewal), and a trade component (reinvest savings into SAP’s new product), making it a compelling case.

Checklist: Building Your True-Down Proposal

  • Internal Business Case: Calculate the financial impact of the reduction (how much maintenance $ you’ll save) and get finance and IT leadership on board with why this matters.
  • Benchmark and Precedents: If possible, find out if other companies (perhaps via user groups or advisors) have achieved true-downs with SAP. While you can’t cite external references to SAP, it boosts your confidence to know it’s been done.
  • Insist on Written Agreements: Plan that any agreement with SAP will be captured in writing. Have your legal or procurement team ready to review and ensure the contract language explicitly reflects the license reduction and adjusted fees. Don’t rely on trust or goodwill – get signatures on the terms.

Documentation and Governance – How to Lock In Your Reduction

Even if you succeed in negotiating a license reduction, your work isn’t finished until the paperwork and systems reflect it. Proper documentation and governance are essential to fully realize the benefits of a true-down.

Here are the steps to finalize and govern a license reduction:

  1. Obtain Formal Documentation from SAP: When SAP agrees to a true-down, insist on an official contract addendum or a license termination letter. This document should specify the exact licenses or quantities being terminated and the effective date. It could be an updated Order Form or an amendment to your agreement. Having this in writing ensures there’s no confusion later about what was agreed.
  2. Update Your Internal License Inventory: Adjust your records in SAP license management tools (like SLAW or your internal CMDB) to remove or mark the terminated licenses. This is important for compliance – you don’t want someone accidentally assigning an “unused” license that was actually terminated. Keep your entitlement registry accurate.
  3. Verify Maintenance Fee Adjustments: Check the next maintenance invoice from SAP after the reduction takes effect. The annual support fee should drop proportionally to the licenses you terminated. If you cut 15% of licenses, roughly a 15% maintenance decrease should show up (unless other price factors changed). If the reduction isn’t reflected, raise it with SAP immediately. Also, ensure SAP isn’t charging any premature termination penalties unless those were part of the negotiation.
  4. Archive Proof for Your Records: File away the signed amendment/letter in your “SAP contract bible” – a repository of all key SAP agreements. This is vital for future stakeholders to remember that a true-down was agreed. As people move roles and SAP account teams change, you want ironclad proof in case of any dispute down the line.

Governance Tip: No reduction is truly final until it’s reflected in SAP’s systems. Internally, establish a policy to consider the true-down completed only when the SAP support invoice and entitlement list officially reflect the reduced licenses and fees.

In other words, verbal or email confirmation isn’t enough – trust but verify through the actual billing.

By following these governance steps, you ensure that your hard-won license savings don’t slip through the cracks. Vigilance after the negotiation is just as important as the negotiation itself.

Checklist for Downsizing SAP Licenses

If you’re looking to downsize your SAP licensing, use this high-level checklist to guide your process:

  • Inventory Your Licenses and Usage: Gather a full list of your SAP entitlements and compare it to actual usage data. Know your baseline.
  • Identify Drivers for Reduction: Pinpoint the business reasons (downsizing, cloud migration, M&A, etc.) that justify a license footprint reduction.
  • Compile Evidence of Shelfware: Document unused licenses with hard data (user counts, engine capacity, login reports) to make a fact-based case.
  • Engage SAP Well Before Renewal: Don’t wait. Start conversations with SAP 6–12 months before a renewal or contract end to discuss your intent to optimize licenses.
  • Leverage Timing and Leverage: Choose the right moment (contract renewal, new project discussion) and use any leverage (competitive alternatives, executive pressure, future spend) to support your request.
  • Negotiate Trade-offs if Needed: Be open to swapping value – unused licenses in exchange for something like cloud credits or a new product. Aim for a win-win deal structure.
  • Document the Agreement: Get any license reduction or maintenance adjustment in writing via contract documents. Handshakes don’t count.
  • Verify the Outcome: After negotiation, double-check that SAP’s invoices and your records reflect the new, lower license count and costs. Only then consider the task done.

Keeping this checklist in mind will help ensure you cover all bases when pursuing a true-down and avoid common pitfalls.

Related articles

5 Tactics to Reduce Your SAP License Footprint

  1. Plan True-Downs Early: Begin true-down discussions 6–9 months before your renewal. Early planning prevents rushed negotiations and gives you time to escalate if needed.
  2. Use Your Own Data: Quantify unused licenses with internal usage data, not just SAP’s audit figures. This way, you control the narrative on what’s truly shelfware.
  3. Leverage Change Events: Use big events like M&A or cloud migrations as leverage to reset your license baseline. SAP is more flexible during significant transitions.
  4. Tie Reduction to New Value: Link license reductions to new SAP investments (cloud services, new modules) to make the proposal attractive for SAP. It shows a continued commitment while optimizing costs.
  5. Get It in Writing: Always secure written confirmation of any license termination or maintenance reduction. Ensure the contract and support invoices reflect the changes so you realize the savings.

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author avatar
fredrik.filipsson
Fredrik Filipsson is the co-founder of Redress Compliance, a leading independent advisory firm specializing in Oracle, Microsoft, SAP, IBM, and Salesforce licensing. With over 20 years of experience in software licensing and contract negotiations, Fredrik has helped hundreds of organizations—including numerous Fortune 500 companies—optimize costs, avoid compliance risks, and secure favorable terms with major software vendors. Fredrik built his expertise over two decades working directly for IBM, SAP, and Oracle, where he gained in-depth knowledge of their licensing programs and sales practices. For the past 11 years, he has worked as a consultant, advising global enterprises on complex licensing challenges and large-scale contract negotiations.
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