There’s a pitch I’m hearing from every major SaaS vendor right now: consolidate your tooling onto our platform. We’ll replace your five point solutions with one integrated suite. You’ll save money, reduce complexity, and your teams will be more productive.

It’s a compelling story. And sometimes it’s even true. But I’ve seen enough consolidation projects to know that the reality is more nuanced than the sales deck suggests.

The Consolidation Pressure Is Real

Australian enterprises are running more SaaS applications than ever. Productiv’s 2025 SaaS report estimated that mid-size companies use between 150 and 300 SaaS tools. Large enterprises run 500 or more. Many of those subscriptions are redundant, underused, or forgotten entirely.

The costs add up. A $50/user/month tool that’s being used by 200 people across three departments costs $120,000 a year. Multiply that by a dozen similar tools, and you’re looking at serious money — often without anyone having a clear picture of the total spend.

CFOs are asking questions. CIOs are under pressure to reduce the total number of vendors. Procurement teams want fewer contracts to manage. On paper, consolidation makes obvious sense.

But on paper and in practice are different things.

When Consolidation Actually Works

I’ve seen consolidation deliver genuine savings in specific scenarios.

Multiple tools solving the same problem. If three departments each bought their own project management tool independently, consolidating onto one platform is almost always a win. You’re not losing functionality; you’re removing redundancy. The training cost is a one-time hit, and the ongoing savings are real.

Vendor overlap from acquisitions. Post-acquisition, it’s common to find two of everything — two CRMs, two ITSM platforms, two data analytics tools. Consolidation here is necessary, not optional, and the financial case is straightforward.

Low-adoption tools. If a tool has fewer than 30% of its licensed users actively logging in, you’ve got a consolidation candidate. Either the tool isn’t needed, or the need is being met elsewhere. Either way, you’re paying for shelf-ware.

Integration-heavy workflows. When you’re spending significant money on custom integrations between point solutions, a single platform that handles those workflows natively can reduce both licensing and maintenance costs.

When Consolidation Costs More Than It Saves

Here’s where it gets tricky. Not all consolidation delivers the promised savings, and some actively makes things worse.

Replacing best-of-breed with good-enough. A platform suite that does ten things adequately is not the same as ten specialised tools that each do one thing brilliantly. If your marketing team relies on specific features in their current analytics tool that the “consolidated” platform doesn’t replicate, you’ll end up keeping both — paying for the platform and the point solution.

I’ve watched this happen with Microsoft 365 consolidation plays. A company migrates from Slack to Teams, from Zoom to Teams, from Trello to Planner, and from Miro to Whiteboard. Six months later, half the company is running Slack and Miro on personal accounts because the Microsoft alternatives don’t meet their needs. You’ve added cost without removing it.

Migration costs exceed savings. Moving data, retraining users, rebuilding workflows, and managing the transition period all cost money. I’ve seen consolidation projects where the migration took 18 months and the break-even point was three years out. By then, the platform had changed its pricing model and the projected savings evaporated.

Vendor lock-in deepens. Consolidating onto a single vendor’s platform makes you more dependent on that vendor’s pricing, roadmap, and business decisions. When everything runs on one platform, your negotiating position weakens. The vendor knows you can’t leave easily, and they price accordingly.

The hidden cost of compromise. When teams are forced onto tools that don’t fit their workflows, productivity drops. That cost doesn’t show up on the SaaS licence spreadsheet, but it’s real. Engineers forced off their preferred development tools work slower. Designers constrained to generic tools produce lower-quality work. Sales teams with a CRM that doesn’t match their process miss follow-ups.

A Framework for Deciding

Rather than a blanket consolidation strategy, I recommend evaluating each consolidation decision against these criteria.

Measure Actual Usage First

Before you cut anything, measure real usage. Not licence counts — actual engagement. Tools like Zylo, Productiv, or even basic SSO login analytics can tell you who’s actually using what. You can’t make good consolidation decisions without this data.

Calculate True Total Cost

For each proposed consolidation, calculate:

• New platform licensing costs
• Migration costs (data, integrations, custom configurations)
• Training costs (don’t underestimate this)
• Productivity loss during transition
• Ongoing maintenance of the new platform
• Estimated cost of re-adding point solutions when the platform falls short

Compare that total against the current cost of running separate tools. Include the cost of the integrations you’re maintaining, but be honest about whether the new platform truly eliminates them or just moves them.

Talk to the Users

The people actually using the tools know whether a consolidated alternative will work. Don’t make these decisions purely from a spreadsheet. If your data engineering team says the proposed analytics platform can’t handle their workloads, believe them. They’re not being resistant to change; they’re telling you a technical reality.

Consider the Contract Timeline

Don’t consolidate mid-contract. Wait for renewal windows. Use the consolidation as a bargaining chip in negotiations — tell your current vendor you’re evaluating a platform move and see what pricing they offer to retain you. Some of the best SaaS deals I’ve seen came from the threat of consolidation rather than the actual consolidation.

The Honest Answer

Should you consolidate your SaaS stack in 2026? Probably partially. Most organisations have genuine redundancy that can be eliminated. But the vendors pushing platform consolidation have their own agenda, and total consolidation almost never delivers what’s promised.

The sweet spot for most Australian enterprises is targeted consolidation: remove the obvious redundancy, standardise where workflows genuinely overlap, but preserve specialised tools where they deliver clear value.

And whatever you do, don’t let a vendor’s discount on a three-year platform deal drive your strategy. The cheapest licence price means nothing if the tool doesn’t do the job.

Consolidation is a means, not an end. The end is spending money on tools that people actually use to do work that actually matters. Sometimes that means fewer tools. Sometimes it means different tools. And sometimes it means keeping exactly what you have and just cancelling the subscriptions nobody uses.

Start there. You might be surprised how much you save without changing a single workflow.