I almost switched vendors today.

After many, many years with our current solution, I was ready to make the jump. New vendor lined up. Budget approved. $80,000 a year contract ready to sign.

Then I saw it: $7,500 migration fee.

And just like that, the deal died.

It’s Not About Affordability. It’s About Friction.

Here’s the thing — I can afford $7,500. I can pay it for something valuable if I need to. That’s not the issue.

The issue is that this vendor was already slightly more expensive than our current solution. So in my head, I was already justifying the incremental cost based on better features, improved support, whatever the differentiators were.

Then you add another $7,500 on top?

Suddenly, the math gets ugly. The ROI timeline extends. The “this is a no‑brainer” decision becomes “I need to think about this.”

That’s friction. And friction kills deals. It really, really does.

The Real Cost of Migration Fees

This vendor just pushed an $80,000 ARR deal from Q4 2025 into 2026. Maybe it happens. Maybe it doesn’t. But what definitely happened is:

• They lost 1‑2 quarters of revenue

• They gave me time to second‑guess the decision

• They gave my current vendor time to retain me

• They added a psychological barrier to switching

All for $7,500.

Think about that ROI. They’re protecting a one‑time $7,500 fee at the risk of losing $80,000 in ARR. Over three years, that’s $240,000+ in contract value.

The math doesn’t math.

When Migration Fees Make Sense (Spoiler: Rarely)

Look, I get it. Migrations are real work. Data transfer, integration setup, customer hand‑holding — it costs you money.

But here’s what most B2B vendors miss:

Migration fees optimize for the wrong metric.

You’re optimizing to recover costs on a single transaction. You should be optimizing for customer lifetime value and minimizing barriers to acquisition.

The only time migration fees make sense:

• Truly complex, enterprise‑scale migrations requiring substantial professional services

• When you’re positioning as a premium solution and the fee is a tiny fraction of the total contract (think $10K fee on a $500K deal)

• When your product is so differentiated that customers will pay anything to get it

For everyone else? You’re just giving your competitors a gift.

What Winners Do Instead

The best SaaS companies I’ve seen handle this differently:

Option 1: Eat the migration cost. Build it into your unit economics. If you can’t afford to onboard a customer properly, you have bigger problems than migration fees.

Option 2: Include it in Year 1 pricing. Slightly higher first‑year fee, then standard pricing going forward. Same economic outcome for you, but psychologically easier for the buyer.

Option 3: Make it optional. Offer white‑glove migration as an add‑on, but provide self‑service tools for free. Let customers choose their own adventure.

Option 4: Waive it strategically. Build the fee into your pricing but waive it during negotiations. Makes you look flexible and customer‑centric.

The Lesson for B2B Founders

Every fee you charge is a decision point. Every decision point is a chance for the customer to walk away.

You’re not just asking for $7,500. You’re asking the customer to:

• Justify additional budget

• Defend the total cost internally

• Question whether the switch is really worth it

• Consider staying with the incumbent

I was a qualified, motivated, budget‑approved buyer. I was trying to give this vendor $80,000 a year.

And a $7,500 migration fee stopped me cold.

So ask yourself: Is that fee really worth it? Would you want to pay it yourself?

Because I can tell you from experience — the answer is usually no.