SaaS spend management: how companies cut software waste and AI cost surprises
The average company in Zylo's 2026 index spends $55.7 million a year on SaaS across 305 apps. AI features are now the fastest-growing source of surprise charges.
Software subscriptions have become one of the largest IT costs, and one of the hardest to track. Zylo's 2026 SaaS Management Index puts the average company's annual SaaS spend at $55.7 million, up 8% from a year earlier, with a median of $20.6 million. The average portfolio holds 305 applications.
AI is changing the picture fastest. Zylo reports spending on AI-native applications rose 108%, and 78% of IT leaders said they had unexpected charges tied to AI features or usage-based pricing.
Why SaaS spend gets out of control
Anyone with a credit card can buy software, so departments sign up for tools IT never sees. Licenses stay assigned to people who left or never logged in. Several teams buy overlapping tools. Contracts auto-renew at higher prices because nobody noticed the notice period. And AI add-ons and usage-based pricing make costs harder to predict than per-seat plans.
A spend management process
| Step | What to do |
|---|---|
| Discover | Combine finance records, expense reports, single sign-on logs and browser or network data to find every app |
| Assign owners | Every app gets a business owner and a budget line |
| Measure use | Compare licenses bought with active users over 90 days |
| Rationalize | Pick one tool per job where several overlap |
| Right-size | Remove unused seats and downgrade plans where premium features go unused |
| Manage renewals | Keep a renewal calendar and start reviews 90 days before each date |
| Govern AI | Approve AI features and usage-based plans centrally, with spending caps |
Renewals are where savings happen
Most savings come at renewal, when you have the most bargaining power. Start early, bring usage data, and know your alternatives. Ask for price caps on future increases and the right to reduce seats.
Tools
Dedicated SaaS management platforms automate discovery and usage tracking. Smaller companies can start with SSO reports, a finance export and a spreadsheet. Cost management for cloud infrastructure is a separate discipline, covered in our cloud cost guide.
What IT teams should do
- Build a list of every SaaS app from finance and SSO data, with an owner for each.
- Remove licenses with no logins in the last 90 days.
- Put every renewal date on one calendar with a 90-day review reminder.
- Require approval and spending caps for AI add-ons and usage-based plans.