7 Signs Your Rapid Growth SaaS Has Outgrown its Subscription Billing Process

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Your business survived its startup phase and is quickly picking up customers. Your team is solid, your product is strong, and customers seem to genuinely appreciate this thing you’ve created. By every measurable metric, your business has grown.

The problem? That growth doesn’t quite feel the way you thought it would.

All of a sudden, expenses are up, productivity is down, and revenue leaks are starting to show. But worst of all? Your customers are beginning to notice something’s going on.

More mistakes are being made than usual. Issues have been falling through the cracks. And you’re pretty sure you’ve even lost a few customers to churn because your service has slipped over the past few quarters.

So even though your business is doing well on paper, it doesn’t seem much better off than when it was a startup.

For many SaaS businesses, this is a familiar story—one that strongly indicates you’ve outgrown your initial operations framework, including your digital infrastructure.

It’s a problem that impacts almost every business eventually. On an annual basis, roughly 70% of businesses claim to be actively enhancing their digital infrastructure. It’s easy to fall behind if you aren’t one of them, and the tech gaps become very apparent under the stress of growth.

While growing pains (or outgrowing pains) are very real, the solution is often simpler than you’d imagine.

Here are some strong signs your SaaS business needs a digital transformation when it comes to revenue operations; and more specifically, your finance operations around your subscription billing process.

1. Aging receivables are on the rise

Revenues (and possibly even customers) are slowly but steadily trickling out each month. A quick look at the books reveals more than 5% of your monthly revenue is being lost to delinquent payments and even churns.

2. You aren’t flexible enough on pricing

Your marketing and sales teams can’t get creative on pricing strategy and packaging options without creating downstream complications for your billing and finance teams.

3. You can’t customize at the customer level

When your team does create custom offers for customers, it usually means you have to create an entirely new product listing. Is your catalog overflowing yet?

4. Your billing department’s in the weeds

Manual signups. Manual subscription management. Manual billing? Your team’s now spending significantly more time and effort on a billing process that’s becoming less effective than it was when you were a startup.

5. Accuracy has become a big problem

Without a reliable single source of truth for your subscription data, your billing and reporting suffer from inaccuracies. Fingers crossed you don’t get audited.

6. Mid-term revenue opportunities are slipping through your fingers

Your team is unable to handle proration, which means you’re continually forfeiting revenue on mid-term sign-ups and plan migrations. Nice for some customers… not nice for your bottom line.

7. Revenue recognition and reporting issues

Your team struggles to recognize revenue in a way that’s compliant with the GAAP ASC 606 standard.

Okay, so a few (or all) of the above signs are sounding way too familiar. You’ve clearly outgrown your subscription billing process.

What now?

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Complete Guide to Subscription Billing

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Grow past the pains by transforming your billing process

These billing pain points, though frustrating, are a very common experience for SaaS businesses being hobbled by antiquated financial processes and infrastructure. And upgrading to processes and technologies that will suit your needs now as well as in the future is an important step in the maturation of your business.

Making the leap from a manual or legacy billing process to automated billing software isn’t just a matter of convenience—though your team WILL be thrilled to ditch their current onerous system. It’s an efficiency and optimization tool with impacts that permeate all departments of your business.

All of the pain points listed above can be resolved by a modern billing automation and subscription management platform.

bitHeads—a software development business that sells its backend software as a service—was able to use Fusebill’s automated collections process to start recovering 5-10% of its revenue monthly.

And JustLogin—a SaaS in the human resources market—enhanced its scalability by reducing the time its team spent on billing by 90%.

More revenue collected and time to dedicate to high-level strategy are enormous assets to any growing business.

And how grateful will your sales team be with the flexibility to approach their next big prospect with an offer that’s been tailored to their exact needs and budget?

Businesses that sell software as their service need every competitive advantage they can get their hands on to stand out against the deluge of similar services that crop up on what now feels like a daily basis.

Modern adaptive SaaS billing isn’t optional

The SaaS market has grown by an average of more than $14 billion a year over the last decade, and we can reasonably expect to see similar patterns of expansion in the years to come.

This means digital transformation ceases to be optional. And businesses that do continue to sidestep this important evolution will fail to compete against companies that have contemporary technological resources on their side. With leaking revenue, inflexible infrastructure, data inaccuracies, and an overburdened workforce, they’ll also struggle to build on their successes.

The pain points listed above make success a lot more difficult than it needs to be.

Efficiency and accuracy in your financial department enables your rapidly growing business to quickly derive better insights to focus on lucrative opportunities. This is a competitive advantage.

While building scalability will always come with necessary adjustments, implementing the proper tools can make the growth process much easier. An adaptive, automated billing process lets rapid growth be the good thing it should be. By upgrading your billing platform, you take any potential scale-up pain out of the equation for continued success.

Tags: SaaS Subscription Billing Recurring Billing Subscription Management Subscription Business SaaS Billing

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