Renewing your Microsoft 365 Business or Enterprise licensing isn’t just a routine task—it’s a strategic opportunity. Before auto-renewal kicks in, take time to reassess how your licensing aligns with your evolving business goals to ensure you get the best M365 license for your organization.
Whether you’re scaling up, tightening budgets, or looking to boost security, the right Microsoft 365 renewal decision can save you money, improve productivity, and future-proof your operations.
Key Considerations When Renewing Your Microsoft 365 Subscription
1. Align Licensing with Workforce Changes
If your workforce has changed, your license count should reflect that.
- Growing? Consider locking in a one-year subscription to take advantage of discounted pricing.
- Downsizing or unsure? A month-to-month Microsoft 365 plan offers the flexibility to adjust licenses without long-term commitment (20% more than an annual subscription).
Regularly reviewing your license usage ensures cost-efficiency and compliance.
2. Use Flexible Licensing to Test New Features
Monthly licensing makes it easy to try new capabilities without a full-year commitment.
- For example, want to test Microsoft Teams Calling? Add it for a few months and remove it if it doesn’t suit your needs—no penalty.
- This flexibility is especially useful for companies evaluating communication, compliance, or security features.
3. Evaluate Your Security Needs
Microsoft continues to expand its security offerings – review whether your current plan includes the latest tools.
If your organization is handling more sensitive data or facing stricter compliance demands, it may be time to upgrade to a license that includes:
- Advanced threat protection
- Microsoft Purview
- Data Loss Prevention
- Retention Policies
- eDiscovery Tools
- Microsoft Defender for Office 365 Plan 1 or Plan 2
- Intune
- Mobile device management
- Device compliance
- Endpoint management
- Copilot
Our team can help evaluate your risk profile and recommend the right security-focused license.
4. Audit and Clean Up Your User List
It’s easy for user counts to drift over time which can put you in the position of renewing licenses that are no longer needed.
- Review your current license usage.
- Remove inactive or duplicate users before renewal.
- Note that plan upgrades can take longer with larger user lists—plan ahead to avoid disruption.
Special Considerations for Nonprofit and Government Organizations
Nonprofit Licensing: Major Changes in 2025
If you’re a nonprofit organization, it’s critical to be aware of Microsoft’s upcoming changes to its grant-based licensing model:
- Ending Free Licenses: As of July 1, 2025, Microsoft will discontinue free grant-based licenses for:
- Microsoft 365 Business Premium (10-user grant)
- Office 365 E1 (up to 300 users)
- What’s Still Available:
- Microsoft 365 Business Basic (Grant): Up to 300 users can continue to access web and mobile versions of Office apps, Teams, SharePoint, and OneDrive – free of charge.
- Discounted Licenses: Nonprofits can still access up to 75% off retail pricing for:
- Microsoft 365 Business Premium
- Office 365 E1, E3, and E5
- Microsoft 365 E3 and E5
- Action Required: Organizations currently using the discontinued free plans must transition to a new plan at their next renewal.
Recommendation: Nonprofits should begin evaluating their licensing needs now to avoid service disruption and budget surprises. Consider whether the free Business Basic plan meets your needs or if a discounted Business Premium or E3 plan is more appropriate for your security and productivity needs.
Government Licensing: Stability with Specialized Options
Government agencies and contractors have access to Microsoft 365 Government plans (G1, G3, G5), which are designed to meet FedRAMP High, CJIS, and other regulatory requirements.
- Key Features:
- Data residency in U.S. government-only cloud environments
- Enhanced compliance and security controls
- Support for hybrid and remote work scenarios
- Licensing Tips:
- Ensure your organization qualifies for GCC environments.
- Review whether your current plan includes the latest compliance tools like Microsoft Purview, Entra ID Protection, and Defender for Endpoint.
Recommendations: Government IT leaders should align licensing with evolving compliance mandates and cybersecurity frameworks. Annual reviews with a Microsoft partner can help ensure continued eligibility and optimal configuration.
Why You Shouldn’t Just Auto-Renew
Business goals evolve. Staffing plans change. New Microsoft 365 features are released every year. Blindly renewing last year’s license could mean missing out on cost savings or critical tools.
A proactive Microsoft Office 365 renew strategy allows you to:
- Optimize your licensing costs
- Ensure you’re using the best-fit tools for your business
- Prepare your tech stack for what’s ahead
Partner with Experts Before You Renew
As a Microsoft partner, Anders provides expert licensing guidance to help you:
- Understand your renewal options
- Maximize the value of your Microsoft 365 investment
- Avoid common licensing pitfalls
Let’s connect before your renewal date to ensure your Microsoft 365 setup is optimized for your business. Contact us to speak with a technology advisor and ensure your Microsoft 365 setup is working for you—not the other way around.
