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Why Have RPA Vendors Raised Their Prices?

2 min read
May 8, 2023 9:00:00 AM

As Microsoft Power Automate has shaken the automation market by offering radical cost reduction with respect to licensing fees, other RPA (robotic process automation) heavyweights have gone a completely different direction.

Traditional and perennial RPA leaders have decided to go the other way and raise their costs—in some cases, by a staggering rate of 4-5x. I have heard this first-hand from the many conversations I have with organizations interested in RPA migration. In fact, rising costs and increased licensing fees are the main reasons organizations are looking to get off their legacy RPA platforms and onto a much more cost-effective option like Microsoft Power Automate.

The question is why are they raising their costs? And more importantly, why now in the face of an impending recession?

Customers are being forced to foot the bill for the inability to grow

From where I’m sitting, the main reason the traditional RPA leaders are raising their prices is because they haven’t hit their aggressive projected growth targets. And now they’re making the customers pay for it so they can recuperate market perception and valuation.

During the pandemic, companies made big bets on growth because of the reliance on technology as business operations went remote and supply chains struggled. A lot of companies scrambled to enter a hyper-growth phase to capitalize on the demand that existed in the marketplace. They hired new employees aggressively believing demand would continue to increase.

They projected revenue targets based on the growth and increase in market share they expected to realize.

A lot of companies didn’t hit those targets. With accelerating inflation and a contracting economy, many of those organizations were forced into drastic cost-cutting measures that included widespread layoffs due to inflated headcounts. It’s been impossible to avoid the headlines peppered in the news from high-profile companies like Google, Facebook, and Amazon reducing staff in the post-pandemic aftermath.

The failure to expand and achieve their lofty goals has resulted in those RPA vendors passing that cost onto their customers. The gap in projected and expected revenue is being filled by increasing pricing models and squeezing more resources out of an already frustrated customer base.

A contracting economy, inflation, and a possible recession doesn’t just affect RPA vendors; it affects everyone. The phrase on all executives’ lips right now is cost-reduction. That’s why so many organizations are contacting me to discuss the viability and business case for migrating their RPA estates from the legacy RPA platforms jacking up prices, to the incredibly cost-effective pricing models that Microsoft Power Automate offers.

Historic RPA leaders have made a very risky wager. RPA migration is no longer a game of chicken. There are tools out there like Blueprint’s RPA Migration solution that automatically migrate entire RPA estates onto Microsoft with 60-75% time and cost savings. Every RPA program now has a way out and they’re taking it in droves.