North American Specialty Retailer: How We Cut a RISE with SAP Renewal by 32% Using Peer Benchmark Pressure

The Situation

The retailer had moved from on-premise ECC to RISE with SAP three years earlier, on a three-year initial term. The original RISE bundle included S/4HANA Cloud Private Edition, infrastructure on a public hyperscaler, base BTP credits, and standard support. The original deal had been signed under time pressure during an ECC end-of-life conversation. The team that signed the original contract was no longer in place. The team running the renewal had inherited a contract they had not negotiated, a bundle they did not fully consume, and a relationship with SAP's account team that had soured over two interim escalations on BTP overage charges.

SAP's renewal proposal arrived 11 months before the contract end date. The headline price represented a double-digit annual uplift versus the existing run rate. The proposal expanded the FUE entitlement by 18 percent (citing peer growth), expanded the BTP credit allocation by 35 percent (citing AI Units and Joule readiness), and added Signavio process intelligence as a default inclusion. The proposed term was 5 years with annual escalators. SAP's account team framed the proposal as a partnership refresh and pushed for signature ahead of Q4. The retailer's CFO asked for an independent review.

We were retained at that point with 8 months to renewal close. Our brief was specific: validate or challenge every component of the proposal, build the buyer-side case, and stay close enough to the SAP commercial team to keep the renewal on schedule without surrendering optionality.

What We Did

1. Quantified the consumption gap. We pulled three years of actual usage data from SAP for Me, the cloud control centre, and the retailer's own monitoring. FUE consumption was running at 72 percent of contracted entitlement. BTP credits had been consumed at 38 percent of allocation across the three-year term. Signavio had no active users. The data killed three of SAP's four expansion arguments in week one.
2. Built the peer benchmark. We assembled comparable RISE deals from our advisory book covering retailers in the 800 to 2,000 store band, normalising for FUE count, infrastructure scope, and term. The benchmark showed SAP's proposed unit pricing sat above the median by 14 to 22 percent across the major line items. We packaged the benchmark into a formal counter-proposal document, anonymised for confidentiality but specific enough on units and ranges to act as evidence of the market.
3. Right-sized the BTP allocation. Rather than accept the SAP-proposed AI Units expansion, we proposed a base BTP credit allocation calibrated to actual consumption plus a 20 percent headroom, with a contractually defined ramp option for AI Units that activated only on board approval. The structure preserved access to the new SAP AI capabilities without paying for them in advance.
4. Challenged the 5-year term. SAP's 5-year proposal locked the retailer in past two significant inflection points: the SAP ECC 2027 deadline (irrelevant to this customer but used as a SAP commercial signal) and the maturity of the 2026 renewal window where SAP is under known revenue pressure. We argued for a 3-year term with a price hold and an extension option, citing the retailer's own board-approved 3-year capital cycle as the governance reason.
5. Engineered the timing pressure. SAP's Q4 was their deadline, not ours. We deliberately kept the deal active but unresolved through SAP's Q3, then engaged seriously on terms in October, knowing the SAP account team's quota pressure would peak. The final concessions on price, term, and BTP allocation all came in the last six weeks before SAP's fiscal year-end.
6. Locked the protections in writing. The final Order Form contained explicit caps on annual escalation, a defined methodology for BTP overage pricing, an exit-assistance clause if the retailer chose to leave at end-of-term, and a contractual definition of FUE conversion ratios that prevented SAP from quietly retrading the user math in a future cycle.

The Outcome

The retailer signed a 3-year RISE renewal at a cost 28 to 35 percent below SAP's initial proposal, depending on how the BTP component is priced into the comparison. The contracted FUE was held flat at consumed levels rather than the SAP-proposed 18 percent expansion. The BTP allocation was right-sized with a contractual ramp option for AI Units. Signavio was removed from the bundle. Annual escalators were capped at 3 percent rather than the SAP-proposed CPI-plus-X formula. Total contracted spend over the 3-year term sat $9M to $12M below SAP's original proposal.

The structural protections matter as much as the price. The defined BTP overage pricing eliminated the source of the prior two escalations. The exit-assistance clause gives the retailer a real option at the 2029 renewal, which restores buyer-side negotiating power in the next cycle. The contractual FUE conversion ratio language closes a common SAP retrade path. The procurement team now has a documented internal playbook for the next renewal, with the benchmark methodology and the consumption baseline maintained quarterly.

What Other Enterprises Can Take From This

RISE renewals are not contract renewals. They are repricing exercises with a contract attached. SAP's account teams arrive with consumption data they have spent three years collecting, peer benchmarks they will not share, and a renewal proposal sized to the upper edge of what the market will bear. The buyer arrives with a procurement team that may not have negotiated the original deal and an internal SAP team that is reluctant to disrupt a working production environment. The structural imbalance favours SAP unless the buyer brings independent evidence.

The two assets that matter most are the consumption baseline and the peer benchmark. The consumption baseline is available in SAP for Me and in the cloud control centre. It tells you what you are using versus what you are paying for. The peer benchmark requires either an advisory firm with comparable engagements or a private exchange of data with peer companies under NDA. Without it, SAP's pricing claims are unchallengeable in practice because there is no independent reference point.

The third asset is timing. SAP's fiscal year ends in December. Their commercial quota pressure peaks in the final six weeks. Most material discounts on renewal proposals come in that window. A renewal that closes in July is structurally worse for the buyer than the same renewal that closes in mid-December. For the underlying mechanics of how RISE renewals are priced and what the bundle elements actually cost, our RISE with SAP licensing guide walks through the FUE math, the BTP credit model, and the contractual levers that drive these outcomes.