Challenge: A Texas-based retail chain with a strong statewide presence (dozens of stores and thousands of employees) engaged Redress Compliance to assist with an upcoming Microsoft Enterprise Agreement (EA) renewal.
The retailer’s IT infrastructure underpins critical operations, from inventory management and point-of-sale systems to an online storefront, all of which rely on Microsoft software. Facing a renewal quote that threatened a significant budget increase, the company aimed to:
- Analyze current software usage: Gain visibility into which Microsoft products (e.g., Office 365, Azure, Dynamics) were actively used or idle.
- Eliminate licensing waste: Optimize license allocations to remove or reassign unused and underutilized licenses, especially given seasonal staffing fluctuations in retail.
- Plan for the future: Develop a roadmap aligning the EA with upcoming IT initiatives like enhanced e-commerce features and in-store digital tools, ensuring any new investments would be cost-effective.
- Benchmark and negotiate: Compare Microsoft’s pricing and discount levels against industry peers to strengthen their negotiating position and secure favorable terms aligned with the retailer’s business goals and tight margins.
The retailer needed expert guidance to achieve a cost-effective, flexible agreement supporting growth while controlling costs—a balance crucial in the low-margin retail industry.
The Process: Redress Compliance worked closely with the retailer’s IT and procurement teams through a structured, story-driven approach:
- Deployment & Usage Analysis: The team comprehensively reviewed all Microsoft deployments across stores and corporate offices. This included evaluating Office 365 usage per employee role, Azure consumption for the retailer’s e-commerce platform, and any Dynamics 365 usage in supply chain management. By mapping actual usage against entitlements, Redress identified numerous underutilized licenses (e.g., premium Office 365 plans assigned to employees who only used email and basic applications). They also discovered duplicate or redundant tools that could be retired.
- License Optimization: Using the analysis data, Redress recommended a shift to role-based licensing. Store clerks and seasonal staff were moved to more appropriate, cost-efficient license tiers (from full-featured Microsoft 365 plans to more basic frontline worker licenses) to better match their needs. Unused licenses were re-harvested and reassigned where possible. This consolidation and rightsizing immediately reduced the license count and eliminated waste across departments.
- Future-Ready Roadmap: In collaboration with the retailer’s IT leadership, a three-year roadmap was developed to guide the company’s technology adoption under the new EA. The plan prioritized solutions that the retailer truly needed for its strategic goals, such as improved collaboration tools for corporate staff and analytics capabilities for customer engagement, while deferring or declining products that didn’t add value. Importantly, the roadmap built scalability for seasonal demand (acknowledging that headcount surges during holiday seasons could be accommodated through flexible true-up terms rather than over-licensing upfront).
- Benchmarking Analysis: Redress provided insights into typical EA pricing and discounts achieved by similar retail companies. By benchmarking the retailer’s proposed renewal costs against market standards, the team identified where Microsoft’s initial offer was overpriced. This market intelligence armed the retailer with data to push for more competitive pricing, preventing them from overpaying compared to peers.
- Negotiation Strategy: With a clear understanding of usage and value, Redress crafted a data-driven strategy. They presented Microsoft with the findings, highlighting the optimized license requirements and areas where the retailer could cut back if pricing weren’t improved. Armed with benchmark data and a willingness to explore alternatives, the retailer negotiated assertively. Redress helped secure deeper discounts on key components of the EA (such as Office 365 and Azure services) and obtained flexible terms allowing the retailer to adjust license counts annually with minimal penalty. Recognizing the well-prepared stance, Microsoft agreed to terms that aligned with the retailer’s operational needs and budget constraints.
Results: The renewed EA delivered both significant cost savings and operational benefits:
- Cost Savings: The retailer realized substantial savings through license optimization and tough negotiation. License cleanup and optimization yielded approximately $1.1 million in cost reductions (by dropping unneeded licenses and avoiding automatic renewals of redundant services). Negotiated discounts and favorable pricing contributed an additional $2.1 million in savings versus Microsoft’s initial renewal quote. The company saved roughly $3.2 million over the three-year EA term.
- Operational Improvements: The retailer reduced Microsoft licensing costs by about 25% while maintaining full compliance. IT and procurement teams now have a streamlined licensing structure that is easier to manage across all stores and offices. The company also improved software utilization by eliminating unused software and aligning licenses to actual roles. Every deployed application has a justified purpose, and “shelfware” (paid-for software not being used) was virtually eliminated.
- Strategic Outcomes: The new EA is flexible and future-proof. It supports the retailer’s growth plans by allowing them to scale users up or down annually in line with store expansions or seasonal workforce changes. The company gained improved visibility into software usage through the analytical tools introduced, empowering better decision-making for IT investments. With reallocated cost savings, the retailer is now positioned to fund new digital initiatives (such as modern point-of-sale systems and customer engagement apps) under a well-negotiated Microsoft agreement.
Quote from the CFO: “Redress Compliance was instrumental in reshaping our Microsoft agreement to fit our business. They helped us uncover hidden inefficiencies and negotiate terms that protected our bottom line. Saving over $3 million on our EA renewal is a huge win for us. More importantly, we achieved a flexible deal that supports our growth and seasonal needs without overspending. This partnership made a complex renewal process manageable and ultimately very successful.”
Key Results:
- Savings Achieved: Approximately $3.2 million total savings over three years, significantly easing IT budget pressures.
- Compliance Enhanced: Maintained 100% licensing compliance throughout, avoiding any audit or penalty risks despite the reductions.
- Operational Efficiency: Optimized the license portfolio by eliminating waste – every Microsoft license now serves an active, needed user or purpose.
- Strategic Alignment: The EA now closely aligns with the retailer’s business cycles and growth plans, enabling cost-effective scalability and innovation in the coming years.
This case study highlights how a retail enterprise, with Redress Compliance’s guidance, turned an impending costly renewal into an opportunity to reduce spend and modernize. The U.S. retail chain saved millions of dollars and gained a tailored Microsoft agreement that empowers its business strategy in a dynamic market.
