The subscription business model can be very lucrative if managed properly. Gone are the days of selling a piece of software and that being the end of the business relationship. More and more, we see businesses switching to a subscription-based model for their software and related services because it gives clients flexibility and companies a more fluid revenue stream. However, one challenge that comes with subscription-based services and solutions is the management and automation of recurring invoices. What follows is a brief overview of areas where subscription billing management software can help you better manage contracts and recurring invoicing.
Maintaining recurring billing can be a very manual task but it doesn’t need to be. Automation is essential for sending invoices out with confidence and dependability. Automating the billing process not only eliminates the chance for human error but also creates better customer satisfaction. After all, who doesn’t like accurate and consistent invoices?
Depending on your business and the contracts you have in-place, subscription billing management software can be customized to fit your business and the billing options you offer. Invoicing is just one of the challenges subscription-based businesses face. If you walk away with one thing from this article, it should be that you understand how important it is to automate invoicing. Once parameters are set, invoicing happens like clockwork.
Forecasting and predicting future revenue is important in a subscription billing business model and can sometimes be a challenge. The more complex invoicing gets, the more difficult it is for controllers or the CFO to make accurate financial forecasts. Some software companies bill monthly, some quarterly—others yearly or more Not only do contract terms make it difficult to forecast but then you also need accurate invoice reporting. It is your part to have an efficient process and fully integrated system in place so reports can be made and finance can make financial forecasts that show true predictions. Most software companies are implementing subscription billing management software platforms just to ensure reliable invoicing processes and to provide higher customer satisfaction.
Contracts themselves play a significant part in the subscription model. It is important to feel comfortable that your business can keep up with contract terms and renewal periods so that revenue isn’t lost and clients are kept happy. Some contracts will roll over into another agreed upon term unless the contract says otherwise; other contracts may be negotiated and agreed upon every time the contract itself is up while others might be set up on a continuation until the client cancels service. Since there are so many variables, most organizations need a system in place to keep track of when clients are due and how to move forward with the contract.
While many assume the best option is to purchase a solution solely for managing recurring billing, it is never ideal for organizations to operate in multiple software systems. Think about how much more efficient your business would be if the subscription billing management software was integrated with your existing ERP or CRM platforms? Many contract billing management solutions on the market are bolt-on solutions. This means they do not fully integrate with your existing financial management platform and the order-to-cash process isn’t as efficient as it should be.
360 Subscription Billing is a Built for NetSuite Native SuiteApp which means it was built to run right within NetSuite—giving you the functionality to track subscription-based services and automate billing, including renewals, invoices, and collection of payments due.