Snowflake has emerged as a go-to data platform for data warehousing,, and analytics in the cloud. But as usage scales, so do the costs, and often unpredictably.
Snowflake offers a pay-as-you-go pricing model which gives freedom to pay only for what you use. But this flexibility often turns into a budgeting nightmare for enterprises, especially those that fail to keep a check on their usage.
This is where FinOps comes in.
FinOps brings together financial awareness and operational best practices. It helps teams track usage, spot waste, and manage cloud costs more effectively without hurting performance.
In this article, we’ll break down how FinOps can help you control spending and get more value out of your Snowflake investment. So let’s begin.
What is FinOps?
FinOps is an operational framework that brings accountability and helps you maximize the business value from use of cloud and cloud operations. It is a best practice, becoming a cultural practice where different teams (finance, DevOps, IT, etc.) come together to collaborate and manage their cloud costs. In other words, every team member takes ownership of their cloud usage to ensure that an enterprise’s cloud spending is well-aligned with its business objectives.
There are three main goals of FinOps:
- To maximize the business value of cloud
- To ensure timely and data-driven decision making
- To create financial accountability
It must be noted that FinOps promotes smart spending and not necessarily less spending. It helps businesses make better decisions on where to invest more and where to scale back in the cloud.
Need for FinOps to Manage Snowflake Costs
As per a report by McKinsey, the potential cost savings through FinOps is massive, with several organizations reporting reduced expenses by 20 to 30%.
FinOps offers a well-defined and structured approach to managing cloud costs. Adopting this practice to manage Snowflake costs offers several advantages, such as:
Reduced cloud spending
With FinOps, business teams can identify inefficiencies such as underutilized resources and eliminate them. This ensures optimal use of cloud resources and reduced costs.
Enhanced decision-making
FinOps offers complete visibility into cloud consumption with real-time reports and insights. Therefore, teams can make better and informed decisions that match their business goals.
Greater team accountability
FinOps brings people from varied teams together to manage cloud spending. This collaboration promotes shared responsibility where each team member feels accountable for their spending.
Improved Forecasting and Budgeting
With detailed insights into usage patterns, FinOps facilitates accurate forecasting and budgeting, allowing organizations to anticipate costs and allocate resources effectively.
Snowflake Cost Drivers
By now, it’s clear that adopting FinOps can significantly reduce cloud spend. But to apply FinOps principles effectively in Snowflake, you also need a clear understanding of what’s driving your costs. Without identifying the key cost contributors, your optimization efforts might fall short. So let’s take a closer look at the major cost drivers in Snowflake.
Compute Costs
Compute costs in Snowflake are determined by the size and duration of your virtual warehouse that is currently in use. Often, this accounts for the lion’s share of your Snowflake cloud spending.
Snowflake offers warehouses in all sizes, from X-Small to 6X-Large. It is important to understand that the price doubles for each ascending tier. Therefore, enterprises must carefully assess and select the required warehouse size for cost optimization.
Storage Costs
Storage costs are determined based on the amount of data stored on the cloud. This includes all the data that your enterprise has stashed across sheets, clones, tables, and various regions.
Businesses must monitor and prune their data regularly. Eliminating all unnecessary and outdated data can help to keep Snowflake storage costs in check.
Data Transfer Costs
This refers to costs associated with moving data between the different Snowflake regions or to a third-party cloud provider.
The only way to minimize this cost is by strategic planning. Businesses must plan well to avoid unnecessary data transfers and save on their cloud spend.
How FinOps Helps to Reduce Snowflake Costs?
As discussed above, FinOps is a cultural practice that helps to optimize Snowflake costs. It involves implementing certain monitoring tools and strategies that help to carefully evaluate usage, optimize resources, and forecast expenses so business enterprises can save on their cloud costs without compromising performance.
Here are some of the most notable ways in which applying FinOps principles can reduce Snowflake costs.
1. Real-Time Usage Monitoring
Snowflake lets users access granular metadata through its Account Usage schema. Thus, teams can closely monitor consumption of credits. This visibility allows for immediate identification of unusual spending patterns or resource-intensive queries, enabling prompt corrective actions.
For instance, let’s say a team member notices a sudden spike in compute credits during off-peak hours. By analyzing the usage data, they identify an automated job running more frequently than necessary. In this case, they can adjust the job’s schedule, leading to massive cost savings.
2. Optimizing Underutilized or Idle Warehouses
Snowflake provides helpful metrics to track how your virtual warehouses are performing, including how much they're being used, how often they sit idle, and how heavy the query load is. Once you obtain information on these data points, you can make informed decisions about warehouse configurations and operations.
For instance, if a warehouse stays idle for long periods, you can enable the auto-suspend feature and set it to something like 60 seconds. That means if the warehouse isn’t doing anything for 60 seconds, it will automatically suspend operations and then resume as soon as a new query comes in. This helps avoid paying for unused time without affecting performance.
You can also resize your warehouses based on how much you're actually using them. If your warehouse utilization is low (say below 1%), it's a good idea to downsize or reduce the number of clusters. On the flip side, if utilization is consistently high (over 75%), upsizing can prevent performance issues and reduce hidden costs like spilling data to local storage.
These small but smart adjustments, powered by FinOps practices, can go a long way in cutting down unnecessary Snowflake spending.
3. Query Profiling and Optimization
Unlike many cloud platforms that charge per query, Snowflake charges based on the time your virtual warehouse spends running queries. So, if a query takes longer than necessary, you end up paying more, even if it’s just due to inefficient code.
That’s why query profiling and optimization are essential FinOps practices for reducing Snowflake costs. The goal is to make queries run faster and more efficiently, so they use fewer resources and cost less.
Now, to optimize your queries in Snowflake, you can use any of these techniques:
· Use Query Profile: Snowflake provides a Query Profile tool, which helps you analyze how each part of your query performs. It breaks down the execution into stages and shows you where time and resources are being spent.
Please note: You can access it by clicking on any completed query in the History tab.
· Identify costly operations: Look for signs like large scans, joins, or spills to local storage, which slow down queries and increase credit usage. The Query Profile will highlight these problem areas.
· Improve SQL Code: Some ways to improve your SQL include using filters early, using clustering keys, or breaking up complex queries into smaller parts.
· Monitor Long-Running Queries: Queries that take too long might be poorly written or pulling more data than needed. You can set up alerts or dashboards to flag these queries using tools like Revefi and reduce your overall Snowflake costs.
4. Setting Up Alerts
Now that you have optimized your queries and rightsized your warehouses, you want to set some proactive monitors to alert you in case of budget overruns. This is where you can set up Snowflake’s resource monitors.
Resource monitors can automatically track all cloud activity, shut down all unnecessary operations, and also notify the team when consumption thresholds are being reached. It is advisable to always set your thresholds slightly below your hard limit to avoid budget overruns.
5. Forecasting
Accurate forecasting is essential for budgeting and financial planning. FinOps practices involve analyzing historical usage data to predict future consumption and costs. Snowflake supports forecasting through time-series analysis, which helps in resource planning.
For instance, by examining past usage trends, a business forecasts increased data processing needs during the holiday season. They can adjust their budget and resources accordingly, ensuring smooth operations without unexpected expenses.
How Revefi Enables FinOps for Snowflake?
All these FinOps strategies can help you reduce your Snowflake costs, but without a dedicated cost monitoring tool like Revefi, it’s hard to tell which strategies are making the biggest impact on your bottom line.
Revefi is built to give you deep, real-time insights into your Snowflake usage. It helps you track where your money is being spent, spot wasted resources, and cut unnecessary costs—so your team always knows exactly what’s driving your cloud bill.
With live cost monitoring, automatic detection of underutilized or idle resources, and smart alerts, Revefi makes it easy to take control of your Snowflake spend and deescalate your cloud costs.
Conclusion
Cloud costs in Snowflake can get out of control fast, especially as data grows and usage expands. But with the right FinOps approach, you don’t have to choose between cutting costs and maintaining performance.
By understanding what drives your Snowflake spend and applying FinOps principles like real-time monitoring, warehouse rightsizing, and query optimization, you can save significantly and spend smarter.
And with a powerful platform like Revefi supporting your FinOps strategy, you’ll get the visibility and control you need to manage your cloud costs with ease.
