I keep seeing 15-person companies paying $40K a year for Salesforce. Or 25-person offices running SAP. Or tiny teams drowning in Atlassian licenses they barely use.

The sales pitch is compelling: “This is what the big players use. Don’t you want enterprise-grade tools?”

Here’s the truth: enterprise software is built for enterprise problems. If you don’t have enterprise problems, you’re paying for features you’ll never use and complexity you don’t need.

Let’s talk about right-sizing your software stack and keeping that money in the bank where it belongs.

The Enterprise Software Trap

Enterprise software makes sense for large organisations with complex needs:

• Hundreds or thousands of users requiring sophisticated permission structures
• Multiple departments needing integration and data sharing
• Compliance requirements demanding detailed audit trails and controls
• Custom workflows that vary by region, business unit, or customer segment
• Dedicated IT teams to manage, customise, and support the systems

If that’s you, enterprise software is worth the cost. If you’re a 20-person business where everyone knows each other and complexity is low, it’s overkill.

But salespeople are good at their jobs. They’ll convince you that you need scalability (“what if you grow?”), best practices (“this is how the Fortune 500 do it”), and comprehensive features (“you might need this someday”).

And once you’re locked in—data migrated, processes built around it, team trained—switching becomes painful. Vendor lock-in is real and it’s expensive.

Where Small Businesses Overspend

Let’s look at common categories where SMBs pay enterprise prices for SMB needs:

CRM systems. Do you need Salesforce’s enterprise tier for 15 sales leads a month? Or would HubSpot’s free tier, Pipedrive, or even a well-organised spreadsheet work fine? Enterprise CRMs charge for features like complex pipeline stages, territory management, and multi-currency support. If you don’t need those, don’t pay for them.

Project management. Jira is brilliant for software development teams running agile at scale. It’s overkill for a small marketing agency tracking client projects. You’re paying for issue types, workflow customisation, and integrations you’ll never touch. Meanwhile, Asana, ClickUp, or Monday.com give you what you actually need for a fraction of the cost.

Accounting software. Do you need enterprise ERP or would Xero handle your bookkeeping perfectly? Small businesses don’t need multi-entity consolidation, advanced inventory management, or complex revenue recognition. They need invoicing, expense tracking, and BAS lodgment. The right-sized tool costs $50/month instead of $500.

HR and payroll. Enterprise HRIS platforms charge thousands for features like succession planning, competency matrices, and learning management. A 20-person company needs leave tracking, payroll, and basic compliance. Employment Hero or Keypay do that for a fraction of enterprise pricing.

Communication and collaboration. Microsoft 365 E5 licensing gives you everything Microsoft offers. You probably need email, file storage, and Teams. That’s E1 or Business Basic. Stop paying for advanced compliance, analytics, and security features you’re not using.

How to Right-Size Your Software Stack

Here’s a practical approach to evaluating whether you’re overpaying:

List what you actually use. For each software tool, write down the features your team uses weekly. Not what’s available—what you actually use. If it’s less than 30% of what you’re paying for, you’re probably on the wrong tier or product.

Match tools to actual workflows. Enterprise software assumes complex workflows. Small teams have simple workflows. Choose tools that match your reality, not aspirations. If your sales process is “talk to prospect, send proposal, close deal,” you don’t need a 7-stage pipeline with automated nurture sequences.

Calculate cost per active user. Enterprise software often charges per seat, and small businesses end up paying for licenses that barely get used. Calculate what you’re paying per person who actually logs in regularly. If half your licenses are inactive, you’re wasting money.

Consider total cost of ownership. Enterprise software often requires implementation costs, training, customisation, and ongoing admin. A $20K/year software license might cost $40K when you include the time spent managing it. Simpler tools often have lower TCO even if the license isn’t dramatically cheaper.

Test whether simpler alternatives work. Before renewing that expensive enterprise contract, test a simpler tool for a month. Can you do 90% of what you need for 20% of the cost? Often yes.

Real Examples of Right-Sizing

Here are some swaps I’ve seen small businesses make successfully:

Salesforce → Pipedrive: Went from $15K/year for 10 users to $3K/year. Lost some automation and customisation. Didn’t matter—they weren’t using it anyway. Sales team actually preferred the simpler interface.

Jira → ClickUp: Dropped from $8K/year to $1.5K/year. Still had everything they needed for project tracking. Less overwhelming for non-technical staff.

SAP → Xero + inventory add-on: From $30K/year in licensing and support to $2K/year. Yes, they lost some features. No, they didn’t miss them. Bookkeeper actually found it easier to use.

Zendesk Enterprise → Freshdesk: Cut support desk costs from $12K to $2K/year. Still had ticketing, knowledge base, and reporting. The “advanced analytics” they were paying for in Zendesk weren’t being used.

Microsoft 365 E5 → Business Standard: Saved $3K/year by dropping down to a tier that still included everything they actually used. Advanced security features were nice in theory but weren’t configured or monitored anyway.

When to Actually Pay for Enterprise

To be clear: enterprise software isn’t always wrong. Pay for it when:

You’re actually enterprise-sized. Once you’re 100+ employees with complex needs, enterprise tools start making sense. The features justify the cost.

Compliance demands it. If you’re in healthcare, finance, or other heavily regulated industries, enterprise security and audit capabilities might be mandatory. Pay for what compliance requires.

Integration complexity is real. If you need deep integration between multiple systems with complex data flows, enterprise platforms with robust APIs and integration tooling might be worth it.

You have dedicated IT resources. Enterprise software often requires ongoing admin and customisation. If you have the team to manage it, you can extract the value. If you don’t, you’re paying for potential you’ll never realise.

The switching cost would be catastrophic. If you’re already on enterprise software with years of data and deeply embedded processes, the migration cost might exceed the savings from switching. That’s a sunk cost keeping you locked in, but it’s still real.

The Build vs. Buy Consideration

Sometimes the right answer isn’t choosing different off-the-shelf software—it’s building something simple and specific to your needs.

For a 20-person company with straightforward requirements, a custom solution built on Airtable, Notion, or even Google Sheets might be more appropriate than expensive software.

Obviously there are limits. Don’t build your own accounting system. Don’t build your own email server. But for workflow tools, project tracking, or simple CRM needs? Custom solutions can be cheaper and better-fitted than enterprise software.

And if you do need something more sophisticated, working with developers who understand right-sizing—like Team400—can get you custom tools at a fraction of enterprise licensing costs.

How to Actually Make the Switch

Okay, you’re convinced you’re overpaying. How do you switch without disrupting the business?

Start with net-new needs. Don’t migrate everything at once. When you need a new tool or capability, choose right-sized options rather than adding to the enterprise stack. Gradually shift over time.

Run parallel for a month. Test the new tool alongside the old one. See if it actually meets your needs before fully committing. This reduces risk and builds confidence.

Migrate data in stages. Move one team, one function, or one process at a time. Ensure it works before expanding. This limits disruption and lets you learn from early issues.

Plan for the transition period. Expect some productivity loss during the switch. Budget time for training and adjustment. It’s still worth it if the long-term savings are significant.

Negotiate with your current vendor first. Sometimes just the threat of leaving will get you better pricing or a right-sized tier. It’s worth a conversation before you commit to migrating.

The Vendor Relationship Reality

Here’s something most small businesses don’t realise: enterprise software vendors don’t really care about you.

You’re not a strategically important customer. You won’t get dedicated support. You won’t influence the product roadmap. You’re paying enterprise prices but getting SMB treatment.

Meanwhile, vendors who focus on small business customers actually care about your experience because you’re their core market. The support is often better, the pricing is transparent, and the products are designed for how you actually work.

Stop trying to buy enterprise credibility through software. Your clients don’t care whether you run Salesforce or Pipedrive. They care whether you deliver good work on time.

The Bottom Line

If you’re a small business paying enterprise software prices, you’re probably overspending. Not always—but usually.

Take an honest look at what you’re paying for versus what you’re using. For most SMBs, simpler tools at lower price points do 90% of what expensive enterprise software does, with 10% of the complexity and cost.

That money you save? It can go toward hiring, marketing, R&D, or profit. All better uses than funding features you’ll never touch.

Right-size your software stack. Match your tools to your actual needs, not the needs of a Fortune 500 company. And stop letting salespeople convince you that enterprise-grade means better.

Sometimes the best tool is the simple one that just works, costs less, and doesn’t require a manual to understand.

Your 20-person company doesn’t need enterprise software. It needs the right software. Figure out the difference and keep the savings.