How the calculator computes your stack spend

The model is intentionally simple so you can estimate quickly, even without a spreadsheet of every invoice. Think of it as a “stack health dashboard.” Here are the core pieces:

We estimate seat-based tools using three inputs: the number of people using tools, how many tools each person typically uses, and the average cost per tool per seat.

• Seat tools monthly spend = teamSize × toolsPerPerson × avgSeatCost

Shared tools are those you’d pay for even if you were a team of one: domain/email, hosting, a phone number, an automation tool, a “team” workspace, etc.

• Shared tools monthly spend = sharedTools × sharedToolCost

• Total subscriptions (monthly) = seatSpend + sharedSpend
• Total subscriptions (annual) = monthly × 12

Waste is your estimate of unused seats and overlap. Many teams have 10–30% waste because tooling grows faster than cleanup. We treat this percentage as the “most recoverable” part of spend.

• Wasted subscriptions (monthly) = totalSubscriptionsMonthly × wastePct
• Recoverable savings (annual) = wastedMonthly × 12

Annual plans reduce price, but lock you in. We estimate the savings if you moved the non-wasted portion to annual billing at your chosen discount.

• Annual billing savings ≈ (totalMonthly − wastedMonthly) × 12 × annualDiscount

Tooling cost isn’t only money. Admin time, onboarding, integrations, and constant “tool tending” consume billable hours.

• Time cost (monthly) = adminHours × hourlyValue
• Time cost (annual) = timeMonthly × 12

The more tools you have, the more you lose to switching, searching, re-learning, and re-authing. This is a “soft” cost, estimated as a percentage of monthly revenue (optional). If you don’t know revenue, set it to 0.

• Switch friction loss (monthly) = monthlyRevenue × switchPct
• Switch friction loss (annual) = switchMonthly × 12

The score is designed for virality: it’s a single number you can share. It’s not a moral judgment — it’s a proxy for “lean tooling.” Higher waste and higher switching friction lower the score.

• Efficiency Score = 100 − (wastePct × 1.1) − (switchPct × 2.2), clamped to 0–100.

3 realistic scenarios (and what to do)

You use 8 tools at $20/seat and have 6 shared tools at $25. Waste is 15%. Admin time is 4 hours/month at $100/hr. You make $8,000/month and feel ~5% switching drag.

• Subscriptions: ~$8×20 + 6×25 = $310/mo
• Waste: ~$47/mo (easy savings)
• Time cost: $400/mo
• Switch friction: $400/mo

Action: Kill one duplicate category (e.g., two note tools). Reduce switching by standardizing on one “home base” (project tool + docs). Your biggest lever isn’t subscriptions — it’s time and friction.

Team of 6, 7 tools per person, $35/seat average, plus 4 shared tools at $80. Waste is 20%. Admin time is 10 hours/month at $150/hr. Monthly revenue is $60,000 with 6% switching drag.

• Seat spend: 6×7×35 = $1,470/mo
• Shared spend: 4×80 = $320/mo
• Total subscriptions: $1,790/mo
• Waste: $358/mo (~$4,296/yr)
• Time cost: $1,500/mo
• Switch friction: $3,600/mo

Action: Assign one person to “stack owner” for 90 minutes. Remove inactive seats, consolidate PM + docs, and create a default client workflow template. Most agencies overpay with chaos, not price.

Team of 20, 9 tools per person, $45/seat, 10 shared tools at $120. Waste is 12%. Admin time is 18 hours/month at $200/hr. Revenue is $300,000/month and switching drag 4%.

• Subscriptions: ~$8,100/mo
• Waste: ~$972/mo
• Time: $3,600/mo
• Switch friction: $12,000/mo

Action: Finance will focus on the $972 waste, but leadership should focus on the $12k switching drag: fewer tools, better defaults, and consistent “where things live.”

A simple “Stack Cleanup Sprint” (45 minutes)

The calculator gives you a target. Now you need a repeatable process. Here’s a fast sprint you can do monthly or quarterly:

Open your last 60 days of bank/credit card statements and list every recurring tool. Don’t overthink categories yet. If a tool isn’t on your statements but is used (like free tiers), keep it on a “free tools” list.

Put each tool into a category: CRM, project management, messaging, docs, design, analytics, automation, accounting, scheduling. Most waste shows up as duplicate categories (two CRMs, three messaging tools, five automation “helpers”).

Choose one winner per category. The winner is the tool that best supports your workflow — not necessarily the cheapest. You’re optimizing for shipping work with less friction.

Remove inactive seats, downgrade plans, cancel duplicates, and pause “maybe later” tools. If you can’t cancel, set a calendar reminder before renewal to review usage.

Decide your “home base” and your “source of truth.” For many teams, that’s one project tool + one docs space. Put the rule in writing: where tasks live, where docs live, where decisions live.

If you’re a solo operator: the biggest win is using fewer tools more consistently. “One place for tasks. One place for notes.”

Frequently Asked Questions

• Is “waste” the same as unused seats?

  Not exactly. Waste includes unused seats, duplicate tools that do the same job, forgotten trials that became paid, and “nice-to-have” tools that aren’t used enough to justify the cost.

• What’s a good waste percentage?

  For small teams, 10–20% is common. For fast-growing teams, 20–35% happens often. If you’re below 10%, you’re either very disciplined or you’re undercounting overlap.

• Should I switch everything to annual billing?

  Not everything. Switch to annual only for tools you’re confident you’ll keep for 12+ months. Otherwise, the discount is outweighed by lock-in and “paying for regret.”

• How do I estimate “tools per person”?

  Count the tools a typical person logs into monthly: email/workspace, calendar, docs, chat, project tool, CRM, accounting, automation, design, analytics, etc. Many teams land between 5 and 12.

• Why include switching friction?

  Because it’s frequently bigger than subscriptions. If switching tools reduces productivity by even 3–6%, that’s thousands per year for a freelancer — and tens of thousands for teams.

• Is the Stack Efficiency Score scientific?

  No — it’s a practical signal. It’s meant to be shareable and to motivate a cleanup. Your real success is shipping work with less overhead.

Where tool stack waste actually hides (and how to spot it)

“We don’t spend that much on tools” is one of the most common small‑business illusions. The reason is that tool costs are fragmented across cards, founders, and reimbursed expenses — and each line item looks harmless on its own. The real drain is the aggregate: dozens of “small” subscriptions plus the ongoing overhead of running them.

• Orphan seats: people left the team, but the seats stayed active.
• Duplicate categories: two task tools, two chat tools, three automation tools, etc.
• Plan drift: you upgraded during a busy month and never downgraded.
• “Shadow IT”: teammates buy niche tools on separate cards (often legit, rarely consolidated).
• Auto‑renew surprises: annual renewals that quietly hit when you’re not looking.
• Tool sprawl: a new tool for each new client/project instead of reusable templates.
• Integrations you don’t maintain: broken zaps and half‑wired systems that create manual work again.

A practical rule of thumb for freelancers and small teams: aim for your subscription spend to stay below 2–6% of monthly revenue (lower if you’re service‑based, sometimes higher if you’re SaaS‑based). Then, separately, watch the “time cost” line. If admin/setup time exceeds a few hours per month, your stack is asking you to be an IT department instead of a builder.

If you’re unsure what to set for waste, use this quick checklist. Give yourself 1 point for each “yes,” then multiply by ~5%. Example: 4 “yes” answers → start with ~20% waste.

• Do you have tools that no one can confidently say “we use weekly”?
• Do you pay for seats for contractors or past teammates?
• Do you have two tools that both do tasks/notes/docs?
• Have you upgraded plans in the last 90 days without a downgrade review?
• Do renewals surprise you at least once per year?
• Do clients force you into their tools (causing tool sprawl)?

The goal isn’t to be cheap. It’s to be intentional: fewer tools, clearer defaults, and less friction shipping work.

The “one winner per category” consolidation method

If you want a no‑drama way to reduce tools, use this method: pick a single winner for each category, then set a 30‑day sunset for everything else. The sunset period keeps you from breaking active projects while still forcing progress.

• Tasks/Projects: where work is tracked and prioritized.
• Docs/Notes: where knowledge lives (SOPs, decisions, checklists).
• Client comms: a primary channel and a default meeting tool.
• Billing: invoices, payments, subscriptions, expense tracking.

Your stack should feel boring: one place to look for the current plan, one place to find the latest version of a doc, and one habit for “closing the loop” (notes → tasks → delivery). When it’s boring, it’s scalable.

Use results responsibly

This tool gives a strong estimate when you don’t want to manually list every invoice. For precise budgeting, export your subscriptions from your bank, accounting tool, or password manager and replace averages with real numbers.

• Decide whether a new tool is “affordable” relative to current stack.
• Set a quarterly stack cleanup target (e.g., save $200/mo).
• Estimate the ROI of consolidation or reducing switching friction.

• Arguing over pennies — focus on big categories and friction.
• Assuming discounts are guaranteed — vendors change pricing often.