If you're running a subscription-based business, you know that billing is key to keeping your customers happy. After all, nobody likes getting surprise charges on their credit card statement. That's why it's important to have a billing system that is clear, concise, and easy to use.
The good news is that there are now many options for subscription billing software, so you can find one that fits your needs. Whether you're looking for a simple way to send invoices or a more comprehensive solution that includes features like online payment processing and fraud management, there's a subscription billing solution out there for you.
How Subscription billing systems help
Subscription billing is a type of billing where a customer pays for a service on a recurring basis. This could be monthly, yearly, or even daily. subscription billing typically occurs with software-as-a-service (SaaS) products, but can really be used for any type of service. In order to set up subscription billing, you'll need a billing platform that can handle recurring payments. This platform will typically also offer other features like invoicing, accounting, and fraud management. Subscription billing is a great way to build predictable revenue for your business. It's also becoming increasingly popular with customers, who appreciate the flexibility and personalization that it offers.
What's also important to consider is how your billing model can help you generate revenue. Today, businesses must offer flexible billing, personalized pricing, and revenue-generating options in order to stay competitive. By offering multiple subscription plans and payment options, you can give your customers the flexibility while still generating the revenue you need to keep your business running.
Subscription billing management
Subscription billing helps establish a relationship with the customer to bill and raise invoices based on specific schedule (i.e. monthly, quarterly, annually) for their subscriptions on a recurring basis. The most common use cases include Software-as-a-Service (SaaS), as well as memberships involving dues and payments. At its core, subscription billing comes all the way down to identifying:
- Who has to be billed?
- What subscriptions/products do they have to be billed for?
- How much should they be billed (pricing model)?
- When they have to be billed (billing cycle)?
- How does one collect payments?
- How does the subscription data have to be reported for analytics and accounting?
Importance of having Subscription Billing Management
Subscription management helps manage the end-to-end customer life cycle. From being boarded through automating and altering the billing according to Customers specifications, processing payments, managing multiple plans, and offering customer support, the process is well streamlined. The automation factor of a subscription management system not only cuts down your administrative costs but also ensures that each of your operations work together smoothly.
What exactly does a subscription billing software do?
The fundamental attribute is to enable and streamline the billing process and offer the business the capability to engage and serve your customers better. Simply put, collecting payments from customers through a versatile range of payment options (credit cards, debit cards, PayPal, Amazon Payments, ACH, wire transfer, checks, cash, etc.).
Managing and automating the operational side of subscription management and billing that include:
- Checkout (trials, freemium, agreement)
- Subscriptions (pricing models, customer portal, exempt)
- Billing (logic, schedule, discounts, credits, taxes, calculation proportionately)
- Invoicing (format, who-to-invoice, transactional emails)
- Collections (payment methods like PayPal, Amazon Pay, dunning/transaction recovery)
- Accounting (integrations, reconciliation, revenue recognition, accounts receivable, deferred revenue)
- Analytics (accurate real-time SaaS metrics, reports)