Being a SaaS company, it is natural for you to be excited about the growth of your subscription business. But ramping up your business means juggling with an increasing number of spreadsheets as you grow.
This can not only slow your growth rate but also introduce the likelihood of errors and mistakes. To efficiently manage your subscription business, what you need is an automated billing software. A subscription billing automation solution can allow you to make changes on-the-fly; you can continuously track and optimize the services you offer and extend their life cycle by optimizing them over time.
Automation enables you to recognize all your revenue sources across a range of business models and helps you comply with the necessary regulations across PCI, application, network, and physical security requirements. It can also help you get the most out of every customer and increase your customer lifetime value.
Let’s understand this in more depth-
Quick processing of orders:
Have you ever wondered how long it takes for you to manually process a new order? For a scaling business, errors resulting from manual processing can have a compounded effect, which can trickle down other facets of your organization and lead to a catastrophe. With subscription billing automation, you can speed up the delivery of invoices without having to worry about anything. You can process orders 5 times faster, and keep errors to a minimum. Subscription billing automation can reduce the time and money needed to correct errors, and safeguard your company’s credibility. This can not only improve customer satisfaction but also reduce churn in the long run.
Seamless upgrading/downgrading of plans:
Given the fact that customer demands change over time, processing an upgrade or downgrade becomes an everyday affair for SaaS companies. Manual processing would require you to cancel one subscription, replace it with another, and make necessary changes in your system to limit revenue leakage. With subscription billing automation, you can seamlessly promote new subscription plans, and easily make changes to plans on the fly – thus improving customer choice, and satisfaction. Easy upgrade/downgrade of plans can enable you to capitalize on every opportunity to maximize revenue and retain customers.
Access to real-time financial data:
For a dynamic industry like subscription, access to real-time financial data is critical to make smart decisions. A subscription billing automation solution provides a bevy of subscription metrics, that clearly indicate the health of the business. Through a single pane, you can see how your business performed yesterday, how it is doing today, and what changes you need to make to ensure it performs better tomorrow. You can unearth insights into customer acquisition, cash-flow trends, and churn rates, monitor customer activity, track lost payments, tweak your strategies, and fine-tune your service offerings to maximize subscription revenue.
Easy identification of outstanding payments:
For any SaaS business, keeping track of outstanding payments is challenging, if not impossible. With thousands of customers opting for thousands of services and plans, accurately identifying outstanding payments becomes a business prerogative. With subscription billing automation, you can always stay updated about your collections and have a clear view of what payments are expected. You can identify customers who are late on their payments and schedule reminder emails to be sent automatically through your system. Built-in dunning management capabilities will allow you to automatically retry defaulted payments, and ensure you never miss out on any payment – ever!
Accurate revenue recognition:
If you’re working with spreadsheets and closing books using manual methods, the process is sure to be time-consuming and error-prone. For SaaS companies, accurate revenue recognition is vital to the financial performance of the business. Subscription billing automation enables you to record revenue the minute the revenue generating process has been completed or the income has been earned, and not when the payment is actually collected or received. You can carry out all your book-keeping tasks in real-time, maintain a steady balance of cash going out and revenue coming in, and ensure credibility for your finances.
For any SaaS-based business, time is money. The faster you can acquire customers, process orders, and realize revenue, the more growth you will encounter. Manual billing processes cost SaaS companies millions of dollars in revenue every year due to billing blunders, wasteful resource allocation, and late collections. Since time is a valuable commodity, subscription billing automation allows you to cut down the processing time to days, instead of weeks and ensures there are no errors in the billing process. With subscription billing automation, you can achieve quicker ROI, and re-deploy resources to other strategic focus areas for improved efficiency.
Ensure consistent cash flow
From a time when a subscription was limited to newspapers and magazines to an age where anything and everything has turned into subscription model – as the market gets more and more competitive, the services that are offered to customers also need to improve.
The key is to do it in a way that does not result in a high cost. Recurring billing can be great for your bottom line, but as you acquire more and more customers, managing them becomes a complex task. Subscription billing automation can allow you to reduce billing errors, track and predict revenue, and ensure customers get what they need. It means you can save a substantial amount of time and keep your cash flow consistent. Subscription billing automation opens up a large window of opportunity, allowing you to quickly process orders, seamlessly upgrade and downgrade plans, access real-time financial data, identify outstanding payments, limit revenue leakage, and achieve quick and significant ROI.