While you may be aware there are benefits to switching to an automated billing software for your subscription business—especially if you're currently struggling with manual or legacy billing systems—the process of selecting the right provider and actually making the transition can seem overwhelming for many reasons.
For example, a lot of subscription businesses have deep concerns about the time and effort involved. One or more team members will need to adjust their busy schedules to research what’s out there in terms of features and solutions, and then determine what’s needed to solve their business’s own specific issues and concerns.
Many subscription businesses also fear the actual implementation. How much effort will be required from their staff to get the new system up and running? And of course, what will it all cost? And once the new system’s in place, will it work the way they need it to? No one wants to be disappointed by selecting the wrong provider—one that doesn’t live up to their expectations.
But the fact is, billing is the core revenue engine of the subscription business model. Making the right choice in a provider is vital to getting paid, especially during times of uncertainty. You want to make sure invoices are getting sent, payments are being collected, and operations are as smooth and efficient as possible so your team can focus on your core business objectives.
If your business is considering making the switch to an automated billing system, but your team is feeling a little overwhelmed at the prospect, the following list may help. It answers a lot of important questions businesses have regarding what billing automation can provide, and what it takes to get your business successfully transitioned.
It also provides some pretty convincing reasons why making the switch can lead to new levels of growth and prosperity—all for a cost that’s less than you might think.
1. Understand Your Business’s Current Billing Gaps and Inefficiencies
Having a thorough understanding of how your current billing system is holding your business back can help you move toward an automated billing system with the solutions to propel your business forward. So chat with your team and locate all the areas of concern.
For example, while it’s common for start-ups to use manual billing processes, this quickly becomes an unmanageable process at scale—not to mention it’s often a gross misuse of talent.
Countless hours get dedicated to performing repetitive billing-related tasks that could easily be automated. Imagine what your team could accomplish if it wasn't so bogged down with the basics?
There’s also the issue of human error. When tasks are performed by humans, there’s always the risk mistakes will be made. Businesses using manual billing processes often suffer from revenue leakage, compliance issues, and various other persistent customer-facing errors that can negatively affect reputation and customer perception.
Legacy and manual billing processes also often lack flexibility when managing product and service catalogs and the technical sophistication needed to offer customers various new deals, discounts, and account alterations in real-time. The continual updates and changes required to compete and meet market demand create a huge drain on time and financial resources.
Dunning management, comprehensive data collection and storage, and in-depth business reporting and forecasting are just a few more of the many areas your business may be lagging if you’re still chugging along without an automated billing system.
So, what’s out there in terms of billing automation solutions, and how can you select a provider that will solve your business needs?
2. Find the Best Automated Billing System for Your Business
Switching to automated billing software is an important step toward your business’s future success, so it’s well worth dedicating some time toward finding your ideal solution. And once you’ve taken stock of any specific gaps and inefficiencies, you can use this information to guide your research in the right direction.
There are many features you should look for and inquire about while browsing software options and communicating with potential providers, including:
- automatic generation of invoices and emails
- flexible catalog and subscription management, including ease of upgrades and downgrades
- accurate, timely billing in conjunction with even the most complex subscription plans and billing models (one-time, metered, usage, recurring, or hybrid billing cycles)
- a self-service portal synced with the billing engine
- integrated payment processing
- dunning management and revenue recovery
- double-entry accounting support
- revenue recognition management, and
- in-depth subscription analytics and insights.
It’s important to ask a potential automated billing software provider about their billing integration capabilities in terms of your existing technologies too. This will provide your business with greater operational flexibility as you continue to scale.
You should also ensure the provider you select offers world-class security features as issues surrounding privacy and security are at the forefront of many industries right now. Best-of-breed automated billing systems will provide your business with a range of security elements, including:
- state-of-the-art firewalls
- network intrusion
- content delivery technology
- application audit logging
- domain authorization, and
- IP address restriction.
The billing system you select should also be backed by PCI Level 1 certification, ensuring your service provider will be audited yearly by a third party to maintain certification and compliance. Having the peace of mind that you and your customers' subscription and financial data will be managed with the utmost care is invaluable.
Concerned about cost? Believe it or not, there are incredible options available at any price point. And by going with a cloud-based service, you can avoid having to make a huge up-front investment in building a static system. Cloud-based systems offer affordable monthly payment options, as well as regular developments and software releases to keep your business on the cutting edge.
Finally, like with any transaction, customer service shouldn’t be downplayed. Read reviews and make sure other customers have been happy with the speed and quality of service offered by providers you’re considering.
The provider you select should always listen to your concerns and work with you and your team to find solutions that fit. In fact, some will even work with your team during the pre-sales process to confirm they’re the right fit for your company before you make the investment.
Once you’ve asked all your questions and are satisfied you’ve found the right billing solution that can meet—and hopefully exceed—the needs of your business, it’s time to get your team ready to make the switch.
3. Prepare Your Business to Make The Switch
Even the best automated billing platforms require some upfront effort to get rolling. But the right billing solution will guide you through the process.
A crucial first step is often to get your entire team working toward the same goal. While there may be a lot of interest about the process—or even some push back from staff with some lingering legacy mentality—it’s helpful to decide in advance who’ll be taking charge of the onboarding and who’ll be making the final decisions. Too many opinions at this point can slow down the process.
Next, sort out your catalog of products and services. A lot of subscription businesses think what they offer to their customers is pretty simple and clear-cut. But when you really drill down and review all the iterations of what’s available, a more complicated selection model is often revealed.
Organizing your catalog in advance can expedite the process of breaking all your products and subscriptions into simplified items within your new billing platform.
Data on your customer base is the next item on the docket. You may think it’s ready to be loaded into the new system, but it could likely benefit from a bit of scrubbing. In order to get the best results from your automated billing system, you need to start with good data.
For each of your clients, you need to ensure you have the following.
- the most up-to-date contact information
- the start and end of their billing cycle
- any special terms or payment arrangements
- their current payment information
- their product/service subscriptions, including the quantity of each and any special pricing agreements
Once you’ve completed any necessary customer data adjustments and updates, you’ll be ready to get started with implementation.
Like with the implementation of any other vital system of record, it’s wise to allocate some time for smooth onboarding in the first few weeks of the transition period.
While undoubtedly, your provider will be an expert at the transition process, you’re the expert of your company and your data. Making yourself or your dedicated staff member(s) available ensures all your information—from your simplified catalog to your scrubbed data—is loaded correctly into your billing system. It will also expedite the entire process to get you and your team working on your new system as quickly as possible.
4. Make The Most of Your New Automated Billing System
Work with your provider to ensure you’re squeezing all the value from your new subscription billing platform. Connect with your dedicated customer service representative, get the support you need, and speak up if something isn’t working the way you need it to. The right provider will be happy to receive your feedback, guide you in the right direction, and even evolve its technology to accommodate new market demands.
And it isn’t just your finance team that will benefit from switching to automated billing either. You will also align different business units and empower them to work together.
Your new system will enable your marketing team to dive deep into your analytics to gain incredible new insight into your customers and modify your subscription pricing to create new offers. Your sales staff will have a better understanding of current market demand. And your leadership team will be able to perform more accurate revenue forecasting to not only make more sound decisions about the business’s future direction and growth, but also manage any potential risks.
The right billing system ensures financial compliance per generally accepted accounting principles (GAAP), including accurate ongoing revenue recognition in line with ASC 606.
And, of course, it facilitates easy acceptance of customer credit cards and other methods of payments, boosting your cash flow, optimizing your billing process, and enhancing the customer experience.
Ultimately, your entire team will enjoy greater flexibility and functionality, more time to focus on what really matters for the business, and peace of mind with regard to security and financial processes and procedures.
Switching With Success, for Success
While making the leap to an automated billing system may seem like a daunting undertaking, it can actually be a pretty seamless process if you select the right software. Additionally, any upfront time and cost put into the switch comes out in the wash.
Billing and invoicing automation will create many new cost- and time-saving opportunities. For example, automating your credit card retries and expiry reminders alone can help you uncover thousands of dollars in revenue leakage within the first few months of implementation.
And the time your staff can save by not managing these billing activities and other business processes manually will eliminate the bottlenecks that have been curbing your business agility.
So, don’t let your fear of the process hold your business back from making the switch any longer. Chances are, you’ll wish you’d done it a lot sooner.