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How small and medium businesses can save money with the Cloud

Article written by Claire Gribbin (Amazon Web Services)

In the current economic landscape, the cost of doing business around the world is increasing. Companies of all sizes are facing a myriad of obstacles, including budget constraints, limited resources, supply chain issues, and ever-changing customer expectations. The pressure to cut costs across all areas makes remaining competitive a challenge—especially for small- to medium-sized businesses (SMBs).

Can the holy grail of cost reduction, increasing efficiencies, and remaining competitive be attainable during times like these? With the help of cloud computing—a powerful tool for generating revenue, automating workloads, and reducing costs—it can be.

If this sounds too good to be true, look no further than the first large-scale study on the cloud, which was carried out by Massachusetts Institute of Technology researcher, Wang Jin. This study found firms which migrated to the cloud experienced increased rates of productivity and higher revenue. It also showed public firms that adopted cloud technology had 2.3 to 6.9 percent higher revenue growth than firms that did not make the switch over the last ten years.

While there are benefits to working with any cloud service provider, Amazon Web Services is committed to helping customers optimize costs above and beyond the general efficiencies that come from initially moving to the cloud.

Increasing revenue and productivity

AWS has many customers who have accomplished higher rates of productivity and increased revenue by creating scalable, repeatable offerings for their customers. Mikatasa, a family-run business in Indonesia selling high-quality paints and adhesives, is one such example. In 2015, the company decided to upgrade its manual processes to reduce the number of human errors. At first, they thought they could keep using on-premises IT systems. But after dealing with multiple downtime episodes and a data leak, they turned to AWS as their cloud provider.

Now that Mikatasa’s core workloads run on the AWS Cloud instead of on-premises servers, the total cost of ownership reduced by 30 percent. Mikatasa avoids hidden expenses, such as maintenance and replacement costs of on-premises equipment. The number of IT members needed to maintain their Enterprise Resource Planning (ERP) system reduced by 50 percent. This allowed the team more time to create frontend solutions, such as an e-commerce ordering site where customers could track their orders. Mikatasa’s salespeople are also equipped with tablets that allow them to track customers’ spending habits and implement changes that will increase future revenue.

SMB customers like Mikatasa benefit from a pay-as-you-go pricing model for the vast majority of our cloud services. They unlock benefits such as:

  • Only paying for the individual services they need, for as long as they’re needed.
  • No long-term contracts or complex licensing.
  • Once they stop using individual services, there are no additional costs or termination fees.

This is a big change from the days of making expensive, risky bets without being able to test systems and equipment. “With the cloud, you can start as an experiment, make sure that you can make it work, and then roll it out across the larger organization,” said Jin in a recent article. “And if something fails, you wouldn’t lose the fixed costs of the IT infrastructure.”

AWS is committed to helping customers take cost optimization to the next level in three major ways: offering tools that automate the complex work of optimizing cloud spend, the vast AWS Partner Network, and their commitment to reducing costs whenever possible.

Learn more from your SMB peers in industries such as travel, healthcare, media, finance and more. Seek inspiration and get exclusive offers in the AWS Connected Community

Optimizing cloud spend with AWS automation tools

Moving to the cloud can help SMBs reduce costs while staying abreast of their larger, better-resourced competitors. One major way AWS does this is by offering automated solutions to ensure that customers don’t overspend. Amazon Simple Storage Service (S3) Intelligent-Tiering is one of the flexible solutions that helps customers reduce cloud costs. This solution automates data lifecycle management, stowing infrequently used data (such as archived files) into low-cost storage classes. This system has saved customers $750 million USD in storage costs since 2018.

Another innovative AWS solution that helps customers reduce costs is the Instance Scheduler, which automates Amazon Elastic Compute Cloud and Amazon Relational Database Service instances. By starting and halting resources on an as-needed basis, operational costs are greatly reduced, and customers are freed from having to watch their own usage.

LoanPro is a financial lending software provider that worked with AWS to migrate to a serverless architecture, automate its development operations, and reduce expenses. As a result, they offer a fully automated solution that integrates with existing software and unifies all aspects of the loan lifecycle. LoanPro proudly supports 1,200 lenders with this solution. After implementation, users experience an average 300+ percent increase in efficiency.

When AWS customers automate cloud cost optimization, they’re not just saving money. They are using their spend in a way that leads to the most efficient, high-value services for their users and freeing up energy to focus on proactively growing their business—instead of just keeping up.

AWS Partner Network drives cloud savings

The robust AWS Partner Network (APN), which features 100,000 partners from over 150 countries, is intrinsic to helping customers cut costs. AWS customers turn to partners when they’re looking to experiment, solve technical challenges with innovative solutions, and access well-architected tools that will help reduce costs. We know this is valuable for SMBs and identified APN consultants for businesses of your size.

Comply, a compliance software solution provider, experienced high AWS expenses each month after it acquired three firms, each with their own unique AWS environments. Comply also noticed that it needed to renew its own AWS Enterprise Discount Program rate, so they used the opportunity to solve two issues at once. They simultaneously integrated the newly acquired environments and worked with AWS to achieve the discounts they needed to scale effectively. Without APN, Mission Cloud Services, they would have been stuck. Comply worked with them and several experts as part of their AWS Enterprise On-Ramp Support Plan (EOP) to help them save over $460,000 USD on their AWS budget.

Committed to constantly reducing costs

Ultimately, companies looking to optimize costs want a cloud provider whose priorities align with theirs. AWS has reduced their prices 129 times since launching in 2006. And a 2022 IDC study found organizations that used AWS Cloud, instead of on-premises data centers, were able cut their yearly IT expenditures by 25 percent.

If you’re trying to decide whether to migrate to the cloud—or are already a cloud convert who is looking to get the most value out of every dollar of spend—AWS will take your need for cost optimization seriously. We constantly offer you new ways to prioritize savings while increasing performance and revenue. Learn more about how you can make your business a smart business.

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