Maximize Revenue by Bringing Efficiency to Your Billing Process

Efficiency optimization is a big task for every business, especially when accessing the relationship between the billing process and the revenue generated from it. The statistics you’ve collected need to be compared to the revenue in your account.

This can be a difficult task and requires a billing operations staff to keep track of all the mid-cycle adjustments so that the process is less tedious.

For a better functioning business, your subscription engine needs to have the required features so that the sales process can work without glitches, deals can be closed more quickly, and estimated sent without delay. It also needs to keep up with any mid-cycle upgrades, downgrades, and delinquent churns.

A significant factor revenue loss can be the absence of an efficient billing procedure. All these procedures and instruments should be integrated with your subscription revenue generator, such as Billsby.

Because without a well-stitched process, companies lose quite a sum of their annual revenue, according to the International Data Corporation, because of operational inefficiencies.

Let's now examine why inefficient billing operations continue to be a major issue under the SaaS model-

●As your business model changes, inculcating special billing arrangements becomes a challenging task.

●The inability to manage critical workflows can generate total confusion for your clients, which compromises the commitment to provide smooth billing structures.

●Each special scenario and a whole lot of dynamic changes in the compliance ecosystem add a development dependency for your finance staff.

●With business growth, you'll inevitably run into internal barriers that will impact the way your customers are treated, and their overall experience.

After establishing the significance of having effective billing operations in place, let us discuss the tactics which will maximize your capabilities around billing and reduce its potential complications.

Before we move ahead to find these resolutions, why not just first put our concentration on the requirement from a good billing system? While submitting an invoice, the goal of the business is a prompt payment which supports their desire to maximize revenue.

To maximize revenue or boost your cash flow, you must see to it that the operational plumbing is in order. And as a result, we have learned an important lesson: to make your billing process effective, you must ensure effective scheduling and charge correctly for the services or products being used by consumers.

Charging clients for non-consumed service would not only impact the business's revenue generation process but also portray it in the bad limelight.

This is why it is necessary for a business to have a dedicated billing system to function correctly. This can be achieved by minimizing consumer friction by improving the payment experience, along with automating the collection process to control the churn rate.

The rest of your consumers' billing experience won't need to be as terrifying if these two functions are carefully thought out.

Let us just move ahead and get to know the steps to make the billing process run smoother -

1. Providing multiple options along with accuracy

It's essential for SaaS and eCommerce firms to be able to bill consumers on certain dates, regardless of when they sign up, as this allows you to give each user flexibility and better accommodate their financial cycles.

With Calendar Billing, you can do this regardless of the date that your customers sign up for service.

There are various methods for billing your clients, and if any user has several memberships, then all the billing dates should be combined into a single billing date. Organizations can also benefit from synchronizing every subscription with a new, set billing date which eventually improves their performance.

This can benefit you by -

●Manage resources, cash flows, and revenue collections to increase predictability.

●Reducing the churn rate and delayed payments.

●Syncing your billing cycle with your customers' financial cycles.

Generally, SaaS businesses like to prorate the cost based on when their customers sign up, but eCommerce organizations typically apply the charge regardless of when your consumer signs up for the complete subscription cycle. This is also a good idea.

It is easy to choose any date for the billing, depending on the subscription period. A monthly membership's billing date can be chosen any day of the month while making it possible to choose any day between Monday to Sunday for a weekly subscription.

Once the billing date has been established, you may choose the billing cycle that will begin on that day. There are two potential routes to take:

●Immediate Alignment

Prorated charges and credits are raised in accordance with the new date, and the subscription billing date is altered immediately. The invoice contains the payment deadline.

An internet and telephone services provider company with a significant number of clients, including business owners and normal individuals, switched to a prepaid billing system, which entails sending the invoice 15 days before the renewal took place.

●Delayed Alignment

The first time a subscription is renewed, it will not be immediately aligned with the new billing date; instead, it will first go through a full billing cycle.

2. Sending out invoices and accepting payments in advance.

It frequently happens that our clients desire to be able to send an invoice before the subscription's start date or its renewal date. These typically count as advance payments a week or two before the subscription starts;.

This is useful if you want to arrange your billing ahead of time to plan for resources like deployment or if you want to conduct a campaign where you charge.

When it comes to invoicing, you may think of this as offering annual contracts to your clients, which raises the contracted MRR and, in turn, your client's lifetime value and retention. Collecting advance payments also helps you get a greater time value for your money and maximize revenue.

You can gather pre-payments for one or more terms of a subscription at once with Billsby's Advance Invoices feature. Additionally, keep in mind that this is the actual invoice and not merely a reminder of it.

In order to let your client, know when they will next be charged, an advance invoice will also include information about the start date and subsequent billing date.

3. Automate and improve failed payment recovery to maximize revenue

Non-payment can occur for a variety of reasons, including expired credit cards, unplanned network outages, insufficient finances, and a hundred more factors that are depleting your hard-earned income.

Knowing when to try and when not to undertake a money collection is, therefore, an important component of a smart dunning plan.

How can you handle circumstances where a client wants to pay you but is unable to? You expand your revenue recovery or maximize revenue with strategies like smart payment retries, often known as dunning.

You can urge your clients to update their payment information and schedule periodic payment retries with Billsby to make sure that money can be made back. Following the final payment retry, you can configure the outcome or the subscription's status.

4. Giving clients payment conditions so they can check their balances.

It can be tough to raise an invoice when the payment cycle of your customer differs from your own. But what if you can arrange for your customer's payments to be made at the same time each month? Great, right?

Why payment conditions? Because it's possible that your clients have multiple internal dependencies that cause payments to be delayed, like making payment arrangements, and more like this.

5. Offering Multiple Payment Methods to your customers to maximize revenue

To exemplify, B2C productivity software was expanding into new markets at a hyper-growth stage. At the time, they only accepted credit cards, which limited their ability to generate income.

However, as soon as they provided more options, their conversion rates increased by over 33%, allowing them to scale internationally and bring in new clients.

This makes offering multiple payment options to your clients an important factor in taking your business to newer heights.

6. Configuring smart rules to facilitate global transactions at scale.

Connecting to a gateway account is essential. Gateways can help you collect and store a customer’s payment information efficiently as well as process all upcoming payments made by the customer using this payment method.

To reduce transaction errors and hedge against performance leaks caused by gateways as you go global, it’s important to map the appropriate currency to the preferred gateway to maximize this revenue.

7. Instead of creating new invoices for every charge, add them to unbilled charges.

The generation of subscription-related charges and their invoicing are separated by the Unbilled Charges feature. When businesses allow customers to change subscriptions in the middle of a billing cycle, this is beneficial.

A subscription may include several costs, such as any kind of modifications in the plan, changing to another plan, any extra add-on during the middle of the subscription period, or more like these.

8. Send a combined invoice with a description of all expenses

When you have customers with multiple subscriptions, it’s common for these subscriptions to all renew on the same day. Especially if they checked them all out at the same time.

Instead of hitting your consumer with a separate invoice for each purchase, you may alternatively combine all the previously listed unbilled charges into a single, consolidated invoice.

9.Sending out reminders before the due date of the invoice.

A vacation rental management system provided by one of our SaaS customers uses the Net D capability, with 60% of their customers making payments offline.

This choice gives their clients time to pay and guarantees to maximize the revenue of SaaS companies.

10.Keeping track by taking contextual follow-up.

Understanding the wants and needs of your customers is one of the most important steps to be taken in the direction of effective customer segmentation.

This information can be gathered through customer surveys, focus groups, and other market research methods. Once you know what your customers want and need, you can segment them into groups based on these factors.

For example, you might segment your customers based on their age, location, or gender. This enables you to develop follow-up advertisements that are more precisely targeted and more likely to be effective with each section.

Additionally, you can use customer segmentation to tailor your product or service offerings to better meet the needs of each group.

By taking the time to segment your customers, you can create more targeted and effective marketing campaigns to maximize revenue. This, in turn, can lead to more sales and a stronger relationship with your customers.

Final Words

Revenue generation is nothing but a survival mechanism. However, maximizing revenue is a priority of every business.

The subscription model is encouraged to create backup payment plans for recurring expenses, which aid in recovering the expenses that could otherwise have been lost, resulting in maximizing revenue.