3 Indicators Your SaaS Billing Software Is Not Managing Growth Enough

Statistics show that the software as a service (SaaS) industry is growing at 13.1%.

Though the competition is fierce, and it is becoming challenging for startups and entrepreneurs to make an entry into the SaaS market, still the market is growing. The revenue of retailers and sellers is multiplying. Companies are coming out of local markets to target a new international customer base. The moral of the story is there is a significant margin of growth in the SaaS business market.

And to enter the competition, you need an efficient SaaS billing software that can help you scale your business with time. When starting a new SaaS business venture, experts spend time to consider SaaS billing platforms that can help them build a perfect tech stack. It is a crucial time for SaaS businesses that can leave long-lasting effects on the growth of the business. So, be vigilant when you are looking for SaaS billing software for your business.

In this article, we are about to mention the indicators that show if your SaaS billing software is helping your business grow or not.

Gear up & read on!

Also Read: Uncomplicate The Recurring Billing Process With A SaaS Billing Software

1. Mismanagement in SaaS Billing Complexities

People think SaaS billing is similar to any normal billing process, but it is not. The customer comes and makes a purchase. He is asked to pay an initial fixed fee. And here, the similarities end. In the case of the SaaS subscription business, the following are some complexities that arise with time:

Proration Management: when customers change their subscription plans, there is needed fixation on the charges. Invoices are also managed accordingly. Sometimes, the amount that the customer paid for the previous plan is more than the plan to which he has shifted. The extra amount that has been paid already should be adjusted in the invoice. In the SaaS subscription business, the customer is not bound to prorate only once. Sometimes, the customer is not satisfied with the prorated pricing plan. He wants to change the plan once again. You cannot let customers go in the subscription business market because they want to change plans frequently. Competitors have robust automated systems to cater to the needs of these customers.
Billing Frequency: the time period after which the customer is billed is called the billing frequency. Today, in the subscription business market, customers are empowered. You need to decide billing model, billing frequency, payment methods, and even payment gateways as per the preferences of your customer base. Flexible SaaS billing platforms allow you to test and try billing frequency and opt for the one that suits your business needs.

When the number of customers increases with time (when the business expands), your SaaS billing solution needs to manage all billing complexities effectively. If you feel any difference in the performance of the billing system, then it indicates that your billing solution is not supportive enough to allow you to expand your business.

Also Read: The Billing Frequency That Suits Your SaaS Subscription Business

2. Poor Customer Experience

Billing is not just a notification for the customer to let him know the recurring fee that he is bound to pay you. Billing is a complete experience in the SaaS business world. And you need to make sure that your customer gets the best billing experience from your SaaS platform. The foundation of the best billing experience is to make the billing processing quick. People who are using SaaS solutions are mostly millennials and Gen Z. These people are known for they want everything done quickly.

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So, your SaaS billing solution needs to make everything so smooth and quick for the customer that he would not only remain loyal to your brand but recommend it to others. When SaaS businesses expand, they enter international markets. And customers in the new markets sometimes demand integration with specific payment gateways. If your SaaS billing solution is not flexible enough to allow the integration with third-party software and payment gateways, then you cannot expect to cater to the needs of your increasing number of customers.

Also, billing is interlinked with the pricing plans and payment processing. Billing models and pricing need to be improvised with time. Nonetheless, customers do not like changes. So, that is the dilemma where you not only need your sales and marketing experts but a robust SaaS billing platform. If your billing platform is not accommodating changes in the pricing plans and billing models, then it indicates you will have to change the billing system to offer customers the experience that they expect.

Also Read: Enhance User Experience—Boost Customer Loyalty with Reward Redemption in SubscriptionFlow

3. Fluctuations in KPIs

Why do you need to decide on a billing model? Why do you need perfect billing? In the end, the SaaS billing is interlinked with the recurring revenue. And SaaS businesses target to have a steady flow of recurring revenue. Key Performance Indicators (KPIs) like monthly recurring revenue (MRR) and annual recurring revenue (ARR) show if the billing is managed properly or not.

For instance, mistakes in billing can cause involuntary churn, and whether it is voluntary churn or involuntary churn, it leads to leaks in the recurring revenue. This leakage can evidently be monitored in the performance of the KPIs. If ARR and MRR are not performing well, then it is probable that your SaaS billing platform is not accommodating the changes in your billing model.

Also Read: Learn How the Best Recurring Billing System are Helping SaaS companies Track these SaaS KPIs and Metrics

Choose the Billing Software That Is Specific for the SaaS

Some SaaS businesses that offer subscriptions, sometimes try to manage their subscription billing and management from the payment gateways that they are using. Payment gateways offer such features as add-ons. However, as the needs and requirements of the SaaS business increase with time, the gateway fails to cope.

So, you need a billing platform that is specially designed and developed for SaaS businesses. Another issue with the SaaS is that there is nothing material which makes it challenging to divide the SaaS product into units and monetize these units. You need a SaaS billing solution that can manage all billing-related worries so that your business can easily grow.

In Conclusion

Though the SaaS startups and entrepreneurs have a limited budget to spend on the billing software, team SubscriptionFlow gives you this suggestion to spare a sufficient budget for the SaaS billing solution because this software is indispensable for your business growth. It is not a piece of cake to shift from one SaaS billing system to the next. In fact, it demands resources and time. Mostly, the budget is the issue when SaaS startups and entrepreneurs knowingly gamble and opt for billing software that cannot fulfil their growing business needs.

If your budget-related issues are causing billing-related worries for your business, then schedule a demo with SubscriptionFlow. Our prices will amaze you whether you run a startup or an established enterprise.