Mobile phones, software applications, and gaming are all areas in which single purchases have been replaced with ongoing subscriptions. It’s also occurring in the entertainment sector. Rather than purchasing music CDs or movies, consumers are opting to subscribe to streaming services that provide large volumes of content for a set monthly fee.

For the businesses providing these offerings, this shift has caused challenges when it comes to the billing processes that underpin their operations. Managing one-off transactions is one thing, but many find themselves struggling with ongoing subscriptions.

Inefficient internal processes can lead to billing errors, revenue leakage, and customer churn. When this occurs, the implementation of an enterprise recurring billing software solution becomes a topic of management focus.

The benefits of recurring-billing software

The companies succeeding in this new subscription-focused marketplace are those that have harnessed the power of specialised recurring-billing platforms. These platforms are designed to automatically invoice customers for products or services rendered on a predetermined schedule such as monthly, quarterly, or annually.

Depending on the sophistication of the chosen platform, businesses may be able to gain a complete view of their entire invoice-to-payment process. The platform will also be able to give the business complete control over when invoices are sent and generate notifications and alerts to ensure timely payments.

Key features on offer

While some recurring billing platforms offer little more than basic features and functionality, more sophisticated alternatives offer true flexibility that can help scale and drive business growth. Leading platforms include:

• A single product catalogue: The platforms can help a business easily define and manage its entire range of products and services. They can apply discounting rules, define dependencies, and standardise offerings across all product lines.
• Customisable and configurable invoices: Leading recurring-billing platforms can allow staff to view invoices by geography, subsidiary, customer, or industry. They can also support complex account hierarchies.
• Improved security: Business clients will also be given an easy and secure way to make electronic payments using debit or credit cards or services such as PayPal. Payment security is enhanced with features such as SOC, PCI, and 3DSv2 compliance.
• Improved revenue recognition: Recurring billing platforms can streamline the task of revenue management by allocating, reconciling, and monitoring revenue for any pricing model, billing approach, or promotional offer.
• A combined solution: By combining billing, collections, and payment processing, a recurring billing platform can reduce days sales outstanding (DSO), improve cashflow, and stop revenue leaks.
• Integrated reporting and intelligence:
  Businesses will be able to optimise billing by turning data into actionable insights through the harnessing of information across reporting, dashboards, and analytics. Factors that can be monitored include total customer value (TCV), monthly recurring revenue (MRR), cash flow, and customer churn.
• Effective support for local billing requirements: Deployment of a recurring billing platform can ensure a business is able to stop worrying about factors such as multi-currency, multi-lingual, and regional tax requirements. Operations will be able to expand across borders by localising offerings to suit region-specific requirements.
• Tight integration with existing front and back-end systems: A recurring billing platform will allow a business to reduce time to market and gain a ‘single source of truth’ through seamless integration with existing service delivery systems, financial systems, customer relationship management (CRM) platforms and enterprise resource planning (ERP) solutions.

The business benefits that will flow from the deployment of a recurring billing platform are significant. As well as improving internal processes, platforms will significantly enhance the level of service delivered to customers throughout their entire subscription journey.

Consider how a platform could assist your business meet its growth goals in 2023.

The post The benefits of streamlined billing processes in a subscription-based world appeared first on Inside Small Business.

A June 2017 bulletin from the Reserve Bank of Australia entitled The Ongoing Decline of the Cheque System noted that cheques represented just one per cent of the number of non-cash payments in 2016; their popularity superseded by other instruments, such as debit and credit cards and direct credit payments.

Fast forward to 2022 and research suggests the COVID crisis has further accelerated the trend away from cheques, with locked-down consumers and businesses opting to make and receive payments electronically. AusPayNet’s August 2020 Future State of Payments Action Plan noted that a continuation of current trends would see no cheques in circulation within five years.

The rise of B2B eCommerce

B2B eCommerce, meanwhile, has been going gangbusters, as enterprises of all stripes and sizes take a leaf out of the consumer playbook and let their fingers do the walking. Forrester predicts B2B eCommerce will be worth $US1.8 trillion, in the US alone, by 2023.

Over two-thirds of business buyers are spending more time and money online than they did, pre-COVID, according to research conducted by eCommerce vendor Sana Commerce late last year. A survey of businesses across seven countries found the average spend was up 45 per cent since the onset of the pandemic.

But selling online to other businesses isn’t as simple as sprucing up your website and waiting for the orders to flow in, just as they do in real life. Like their consumer counterparts, business customers want end-to-end purchasing experiences that are swift and seamless and they’ll take their business elsewhere if they don’t receive them.

A matter of trust

This poses a problem for organisations that aren’t using an eCommerce platform that integrates tightly with their billing and invoicing solutions and their payment gateway provider of choice.

Clunky, cumbersome payment processes can be a real turnoff for business buyers, as can invoices that are incorrect or incomplete.

That’s because payments are all about trust; the bedrock of any B2B relationship. Billing correctly and on time, each and every time, enhances that trust and reassures customers that your business is a professional and ethical supplier, the kind they can count on to do right by their business.

Some won’t be prepared to extend a second chance to ‘billing bunglers’. Instead, they’ll navigate their way to a competitor that understands what professional service looks like in the digital sphere and can deliver it, from order to invoice, rapidly and reliably.

In today’s times, having a facility to accept digital payments is an integral component of that service.

Establishing a foundation for success

Acquiring the right infrastructure makes meeting and exceeding B2B customers’ high expectations an easier proposition.

That’s where revenue management technology comes in. While some businesses may look to develop their own bespoke solutions, integrating disparate billing and payment systems with a payment gateway provider can be a complex and expensive process, and supporting the end result an impost on hard-pressed ICT teams.

Implementing a cloud-based solution that covers the revenue cycle from end to end is a simpler and safer proposition. It’s foundation technology that allows you to track and manage your customers and their orders, bill them accurately and obtain visibility into the entire customer and payment journey.

Choose one that integrates seamlessly with the ERP solution that powers your business and your chosen payment gateway provider and you’ll be well-placed to offer business buyers an excellent online purchasing and payment experience.

As Australian enterprises continue to pivot towards all things digital in 2023 and beyond, it’s an investment that’s likely to pay excellent dividends for many years to come.

The post Why optimising your billing arrangements will give your B2B business a boost in 2023 appeared first on Inside Small Business.

Here in Australia and around the world, thousands of developers have focused their efforts on creating intuitive, user-friendly software that addresses common consumer challenges and significant business pain points.

And they’ve gained mind and market share by offering it to their target markets on subscription, rather than selling it outright.

So successful is the SaaS sector that research house Gartner estimates it to be worth in excess of $145 billion globally, with a growth rate that’s likely to accelerate as businesses of all shapes and sizes continue to digitise almost every aspect of their operations.

Priced to sell

But succeeding in the SaaS space isn’t as simple as developing a – hopefully! – killer app and waiting for customers in your target market to start signing up in droves. There are multiple ways for enterprises like yours to price their solutions and choosing the optimum revenue strategy for your offering can be ‘make-or-break’, when it comes to scaling your operations and achieving profitability.

Slap a steep monthly price ticket or high per-user charge on your offering and, chances are, you’ll see few potential customers joining your subscription queue and even fewer sticking with your solution long term.

Conversely, making your software too affordable may result in a flood of subscriptions – and a cashflow crunch when the revenue coming through the door isn’t sufficient to cover your operating costs.

Selecting a pricing strategy to suit

Long-term success is most likely to be attained when you walk the line between unacceptably expensive and unsustainably cheap.

For some enterprises, that may be achieved via a traditional cost-plus pricing strategy. Also known as mark-up and cost-based pricing, it is as it sounds: enterprises calculate their total production cost and add on whatever they deem to be an acceptable profit margin.

It’s a straightforward way for traditional businesses to ensure they don’t send themselves broke but it may not necessarily be the best way to gain mind and market share in the SaaS arena, where scaling at speed can take precedence over profitability, particularly in the early months and years.

Other SaaS start-ups may adopt a competitor-based pricing strategy, researching the price points at which broadly equivalent solutions are offered and ensuring theirs is in the same ballpark. While taking this tack will mean you’re not eliminated from customers’ shortlists on cost grounds, it won’t necessarily ensure you’re achieving the optimum return on your software development investment.

A value-based pricing strategy, on the other hand, can do just that. Put simply, it enables you to determine exactly what your customers want and to price your flexible offerings according to the value they generate for customers. It’s more individualised and complex than other approaches but, for SaaS businesses in particular, it can be a pathway to profitability and growth based on that most compelling of imperatives – keeping the customer satisfied.

Tools to make the task easy

Whatever pricing strategy you choose to adopt, monitoring its effectiveness is vital. Fail to do so and you’ll find your enterprise missing opportunities to maximise revenue, profitability and growth.

Implementing a cloud-based revenue management solution with sophisticated data analysis capabilities can provide you with complete visibility of your pricing and billing. It will enable you to implement any revenue model – or, indeed, multiple revenue models on a single platform – and to monitor its effectiveness on a monthly, weekly, even daily basis.

If you’re serious about turning your SaaS start-up into a successful, sustainable business, it’s foundation technology you can’t afford not to have in your ICT stack.

The post How the right pricing strategy can help your SaaS start-up succeed appeared first on Inside Small Business.

Recent years have seen the proliferation of applications that allow customers to pay as they go, often via a monthly subscription based on their usage level. Runaway success stories like Canva, Campaign Monitor and Culture Amp need no introduction but they’re not the only homegrown movers and shakers on the block. Scores of other entrepreneurs are following in their founders’ footsteps and, in 2022, the throwaway line, “there’s an app for that” has never been truer.

Scaling up is the chief challenge for most up-and-coming vendors in this space. It’s made even harder if you don’t have access to billing technology that enables you to monitor and manage your customers’ software usage and generate timely, accurate accounts.

Many fledgling SaaS vendors don’t. Rather, they rely on old-school technology, including spreadsheets, to manage the revenue cycle. This modus operandi can be time-consuming and inaccurate; the scale of the challenge only increases as the customer base proliferates.

Billing made simple

The solution isn’t to keep tinkering at the edges. Investing in automated billing software to help you run your SaaS business more effectively, is.

That means switching to a cloud-based revenue management platform that encompasses the revenue cycle from end to end and integrates seamlessly with the SAP or Microsoft Dynamics ERP solution you use to run your business.

This technology makes it possible to capture and consolidate your SaaS usage data, integrate it with systems that track and manage your customers, and analyse it to obtain insights that can be used to inform critical decisions around products and pricing.

Here are a few of the benefits that automating your revenue management process can provide.

Improved customer understanding

Meeting and exceeding customer expectations is the key to success in business and the SaaS sector is no exception. A premium revenue management platform will help you gain a deeper understanding of customer expectations, courtesy of the fact that it can be used to capture data about how, when, where and why your application is deployed. Use those insights to modify and optimise your offering and you’ll be well placed to surprise and delight your customers.

An optimum pricing model

Customer data can also help you determine whether or not your software offering is optimally priced. For many SaaS start-ups, working out how much to charge for their application is no easy matter. Analytics technology that allows you to explore the behaviour of individual customers and specific segments of your target market can help you work towards a pricing model that customers find compelling, and one which is sustainable and profitable in the long term.

Elevated customer experience

Timely, accurate invoices are the cornerstone of good customer relations. Errors and delays issuing the accounts can cause consumers and businesses to question your professionalism and, indeed, whether they should be dealing with your enterprise at all. Billing anomalies can also slow down cashflow; something most growing software businesses can ill afford. Adopt automated, consumption-based billing software and these won’t be issues you have to deal with. Instead, your operations team will be able to generate complex account hierarchies and consolidate and separate invoices with ease.

Setting your enterprise up for SaaS-cess

Transforming a SaaS start-up into a bona fide, big league software vendor is no easy undertaking. Companies that attempt to scale up without implementing rigorous programs and processes to support their growth can scupper their own chances, regardless of the quality of their offering. A strong revenue management strategy underpinned by technology that helps you to service your customer base efficiently will stand your enterprise in good stead, as it expands its market footprint.

The post Why a smarter billing system will help your SaaS business soar this year appeared first on Inside Small Business.

Collectively, Australian franchises employ close to 600,000 people and contribute $184 billion to the country’s economy, according to the latest estimates from the Franchise Council of Australia.

The rocky road to riches

But while, at first blush, franchising may appear an easy route to expansion and greater profitability, the road to riches can be a decidedly bumpy one. For every homegrown success story, there are plenty of also-rans; seemingly promising concepts that have failed to launch or enjoyed flash in the plan success, only to shut up shop a couple of years hence.

The majority of franchise networks fail in the first year and quite a number fall over in the second, according to The Franchise Institute, a local consultancy that’s helped scores of local business owners franchise their brands successfully over the past two decades. Some franchisors over-extend themselves, trying to do too much, too soon, and are undone by a cashflow crunch. Others don’t invest enough in training their franchisees. Brand damage can result, if the quality of products and services is not consistent across all outlets, or if franchisees are allowed to cut corners to improve their profitability.

Meanwhile, not having the right resources in your head office can be an impediment to success. The skills needed to manage and support a multi-outlet franchise operation can be significantly different from those required to establish and expand a standalone business – and acquiring those skills on the fly is quite the challenge.

Implementing sound, robust systems to run your franchise network will up your chances of being a survivor, not a statistic, as you embark on your growth journey.

Among the most important of these is your revenue management system.

Show them the money

The billing relationship between franchisors and franchisees can be a complex one. It can also be a potential source of disquiet and discontent if the latter perceive the system you use to administer payments between the parties to be opaque or error-prone.

As your franchise network grows and you add additional complexity to the mix, in the form of a loyalty or rebate program for example, these issues can compound and lead to significant conflict. That’s a decidedly sub-optimal outcome if you’re looking to build a thriving franchising network and attract high-calibre franchisees into the fold.

Making your billing processes simpler and more transparent can ameliorate the problem and ensure you and your franchisees are all on the same page, financially.

Choosing a billing solution to support your growth

Invest in an automated revenue management platform with the functionality and features to handle complex invoicing arrangements with multiple parties. That means seeking out a billing platform that encompasses the entire sales and billing cycle, including your payments, revenue recognition, collections, refunds and reporting processes, and one which has the capacity to accommodate the specific needs of your franchising model.

And, regardless of the nature of your enterprise, detailed audit trails that enable you to deliver the visibility and transparency today’s franchisees expect and demand is a must-have.

Systems for success

Success in franchising is all about systems. Ensuring yours are flexible, resilient and scalable will up your odds of success in a competitive and challenging commercial landscape. Against that backdrop, investing in a revenue management platform that can underpin your growth through every stage of your business journey is likely to prove an excellent move. 

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