Pay Per User Software Licensing Small Business

Summary

This guide helps you troubleshoot and resolve: Pay Per User Software Licensing Small Business. Follow the steps below to fix the issue.

Common Causes

Pay-per-user licensing is a common subscription model where businesses pay a recurring fee for each individual user who needs access to a specific software application. For small businesses with between five and twenty staff, managing these licenses manually can quickly become overwhelming. Without a clear record of who has access to what, organisations risk paying for unused seats or falling out of compliance during a software audit. This guide explains how pay-per-user licensing works and provides best practices for managing your software subscriptions.

How Pay-Per-User Licensing Works

In a pay-per-user model, a license is assigned to a specific person rather than a single device. This allows an employee to install and use the software on multiple devices—such as a desktop computer, a laptop, and a mobile phone—while consuming only one license seat. Common examples include Microsoft 365, Adobe Creative Cloud, and various industry-specific business applications.

Assigning Licenses to New Staff

When a new employee joins your organisation, follow these steps to ensure they have the correct access:

1. Log in to your software vendor's administration portal using your administrator credentials.
2. Navigate to the Users or Licenses section of the dashboard.
3. Select Add User or Invite User and enter the employee's work email address.
4. Assign the appropriate license plan based on their role and the software they require.
5. Send the welcome invitation and instruct the employee to set up their account and password.
6. Record the assignment in your internal asset register, noting the license type and start date.

Revoking Licenses for Departing Staff

It is critical to revoke licenses immediately when an employee leaves the business. Failing to do so results in unnecessary ongoing costs and creates a security risk if former employees retain access to company data.

1. Notify your IT administrator as soon as an employee's departure date is confirmed.
2. Log in to the vendor's administration portal.
3. Locate the user account under the Active Users list.
4. Select the user and choose Remove License or Deactivate User.
5. If the software allows, transfer any files or emails owned by the departing user to a manager or shared drive before deleting the account.
6. Remove the entry from your internal asset register.

Maintaining Accurate Records for Compliance

Software vendors may conduct audits to ensure that the number of active licenses matches the number of users accessing the software. Poor record-keeping can lead to significant fines or the requirement to purchase back-dated licenses.

Best Practices for Record Keeping

• Maintain a central spreadsheet or asset management tool listing every licensed user, the software they use, and the license expiration date.
• Perform a monthly review of active licenses to identify "zombie seats" (licenses assigned to users who no longer need them).
• Keep copies of all purchase invoices and subscription agreements in a secure folder.
• Ensure only designated administrators have the authority to assign or remove licenses.

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