You can only reduce margin a finite amount. At some point you will be passing on costs. Thus it only makes sense to do so if you'd make more money doing so, by retaining or gaining more customers.
I guess it depends on market. In our niche we're not losing customers at this point, so no need to go down on margins yet. Perhaps we'll get there in the following years. I do know Covid was hard and we did have to help out some of our customers during that period, so perhaps if the economy crashes again soon.
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From the other side of the table kinda, as a SaaS provider, wages here have risen by about 5% each year. And wages is the greatest expense we have.
That said, I'm just an employee so not my call either way.
SaaS gross margin is typically 60-85%. Lots of margin available for customer cost management.
You can only reduce margin a finite amount. At some point you will be passing on costs. Thus it only makes sense to do so if you'd make more money doing so, by retaining or gaining more customers.
Certainly, but we're not there yet. Lots of margin left to compress. "Your margin is my opportunity." someone once said.
(i am very familiar with SaaS economics as an accredited investor with significant exposure to SaaS investments)
I guess it depends on market. In our niche we're not losing customers at this point, so no need to go down on margins yet. Perhaps we'll get there in the following years. I do know Covid was hard and we did have to help out some of our customers during that period, so perhaps if the economy crashes again soon.