Licenses and subscriptions for Business Central
Most companies deal with licenses and subscriptions when they acquire Business Central, and then never revisit it. They buy an additional user when someone asks for it, and the subscription is renewed automatically. That is unfortunate because there is often money to save. As ERP manager you must maintain the overview and conduct a license review at least once a year.
Why the license overview pays off
With Cloud licenses there are far more options than in the old days when you bought a pool of licenses and paid a fixed subscription. Today you can:
- lock in your licenses for multiple years
- adjust up and down continuously
- bundle across Microsoft’s products
- take advantage of campaigns that appear periodically
It requires that someone pay attention. That someone is you as ERP manager.
You don’t need to be a license expert. It is an area where even consultants in the industry frown, because there are many rules, and Microsoft changes them faster than most can keep up with. You should get your partner to advise you. Licenses and subscriptions are not something you handle once and for all.
The license types in Business Central
| License type | What it covers | Who should have it |
|---|---|---|
| Essentials | Finance, sales, purchasing, inventory management, projects | The standard choice for full-time users |
| Premium | Everything in Essentials plus Manufacturing and Service Management | Users who need manufacturing or service modules |
| Team Member | Read data, update existing records, approve, create quotes (not post) | Lighter users such as approvers, managers, occasional users |
| Device | Assigned to a device, not a person | Shared devices such as scanners in the warehouse or computers in the production hall |
Premium applies to the entire environment
Within one environment all full users must be of the same type, either Essentials or Premium. If two out of twenty users need manufacturing, all 20 must be Premium. If you have multiple environments, you can choose to run Premium in one and Essentials in another. You just can’t combine them in the same environment.
Named licenses cannot be shared
All licenses are named, except Device. You can’t share a full user license between two people. If an employee leaves the company, you can transfer the license to a new employee, but two people can’t use it simultaneously.
Subscription terms and commitment periods
Business Central is sold as a subscription, and you can choose between different commitment periods. The choice is about balancing price against flexibility.
| Commitment period | Price | Flexibility |
|---|---|---|
| Monthly | About 20 % higher than annual | Adjustment up and down at short notice |
| Annual (12 months) | Most widespread, lower price | Adjustment only at renewal |
| Multi-year (typically 36 months) | Locks in the price | Protection against future price increases |
Adjustment within the cancellation period
You can adjust the number of users continuously, but within the cancellation period stated in your subscription terms. Your partner must help you with this.
Multiple partners create complexity
You can do business with several partners at the same time. That can mean you have Business Central licenses with one partner, some additional users with another, and perhaps an app from a third. It provides flexibility but can become hard to manage.
We often see companies with subscriptions with different renewal dates, purchased from different partners, and without a unified overview. You must create a way to evaluate the overall picture.
License review: do the licenses match actual use
As ERP manager you know your business. You know how work is done in sales, in finance, and in the warehouse, and you have a good sense of who actually does what in Business Central. That gives you a good starting point for assessing whether the licenses match the actual use.
Two classic sources of waste
Two questions you should ask every year:
- do you have licenses that aren’t assigned to any user
- do you have full users who really only sign in to approve a registration
If you have licenses that aren’t assigned to anyone, you are paying for something nobody uses. If you have full users who only approve, you may be paying for an Essentials license where a Team Member would be enough.
It is surprisingly common. We see companies with five or ten licenses they renew every year, even though they aren’t assigned to a single employee. That is money going out the window.
Conduct a license review once a year
Conduct a license review at least once a year:
- who uses what
- does it still make sense
- have any employees taken on new tasks
- have you hired field-based employees who work differently from office staff
It may well mean that another license type is more appropriate for some employees.
Attach licenses save money across Dynamics 365
If your company uses Business Central together with other Dynamics 365 products, for example Dynamics 365 Sales or Customer Service, you should know Microsoft’s attach license model. It can save you significant amounts.
When a user already has a base license (the most expensive Dynamics 365 product they need), you can add other Dynamics 365 products at a reduced price.
Example of attach licenses
If you have Business Central Premium as the base license, you can add the following at a reduced price per product:
- Sales Enterprise
- Customer Service Enterprise
- Field Service
Ask your partner whether you are taking optimal advantage of attach licenses.
Price changes from Microsoft
In November 2025 Microsoft raised the price of Business Central for the first time in 5 years. We don’t know whether further price adjustments have happened by the time you read this, but Microsoft rarely raises prices.
Twice a year Microsoft also adjusts prices in line with currency exchange rates. That can both raise and lower prices.
Lock in the price with multi-year commitment
You can lock in the price in a commitment period with a multi-year subscription. If a price increase is on the way, you can renew your subscription before it takes effect and keep the old price for the rest of the commitment period.
AI agents and Copilot: what does it cost
| AI function | How it is licensed |
|---|---|
| Copilot in Business Central | Included in the regular Business Central license at no extra cost |
| AI agents (Sales Order Agent, Payables Agent, and your own agents) | Consume credits purchased pay-as-you-go or via prepaid credit packs |
Artificial intelligence is a new licensing area, and it is constantly changing. It is hard to guess how AI agents will be licensed in the future. It is a safe bet that you will pay for consumption and that the pricing model will likely change often.
Governance: who may order licenses
Many companies have no procedure for who may order new licenses, change subscriptions, or purchase additional functionality. The result is that licenses are bought ad-hoc, without anyone keeping track of the overall economics.
Your internal procedure shouldn’t be heavy, but as ERP manager you must have an agreement in place about:
- who has the mandate to order
- who must approve
- who maintains the overview
Use your partner as a sparring partner
You don’t need to be a license expert yourself. Microsoft’s own documents are often written in a language that is hard to understand for anyone but specialists.
You need to know enough to make demands. Have your partner periodically review your arrangement and evaluate whether you still have the right licenses and subscriptions.