5 reasons to use a subscription management solution

The subscription model is on a roll! More and more companies in all sectors are trying their hand at this model. They are opening up to new customers while capitalising on recurring revenues.

In this business model, certain tasks are much more numerous and repetitive than in a non-recurring business. Pricing, invoicing, payments and managing disputes can become extremely time-consuming. What's more, the lifecycle of offers means that their number is increasing, making management significantly more complex.

Here are 5 reasons why a subscription management solution can help you get out from under this rollercoaster of operations so that you can concentrate on developing your business.

1. Centralisation of data and actions

By bringing together management data, accounting data and all management tasks (such as calculations, editing or archiving) in a single tool, a subscription management solution helps to make the work of operational teams smoother and smarter.

Beyond the internal benefits, the implementation of such a platform has a direct impact on customer relations. Take archiving, for example, which, thanks to an industrial process, becomes instantaneous and reliable, with a complete billing history. All invoices are made available to customers, who can consult and download them from a dedicated customer area.

Centralising data also means you can concentrate your efforts where you need them most, thanks to a more accurate analysis of company data. This time saved is invaluable, both for your cash flow and your motivation.

2. Process automation

In a subscription-based business model, there are many more invoices than in a non-recurring business. To avoid wasting time on repetitive, time-consuming tasks with no added value, while limiting the risk of error associated with human intervention, a management tool is essential.

When it comes to calculating invoices, you need a pricing engine that estimates the amount of subscriptions in real time, whatever the complexity of the model: variable pricing, consumption-based invoicing, pay-as-you-go options, and so on. It makes all the adjustments for tricky operations such as changing offers or adding options, and calculates the amount of tax based on billing information and current legislation.

All the information is now directly linked. Complex operations are simplified. Automating and securing recurring billing means you can scale up to handle a larger number of subscribers.

3. Dispute management

The specificity of the subscription sales model is recurring payment. Unlike the e-commerce model, and pending application of the European directive on strong customer authentication (SCA), recurring payment implies the long-term validity of the means of payment. This means that merchants need to be able to handle an ever-increasing number of failed payments.

This is where a tool can be used to manage these payment incidents discreetly and efficiently. In the event of a payment failure, the start of the dunning procedure can be unpleasant, even vexatious, and can lead to unsubscribing. Thanks to an automated "dunning process", the payment representation, sometimes multiple times, is automatic and above all discreet. This guarantees a good relationship with the customer and is also an excellent way of preventing non-payment.

This dunning process, specific to the management platform, recovers up to 15% of failed payments.

It's a significant cash saving and a guarantee of optimised customer relations.

4. Deferring usage, variable subscriptions and calculating taxes

One of the keys to avoiding late payment is the invoice itself. A poorly drafted invoice will be a poorly paid invoice. Subscription-based sales models, particularly pay-as-you-go models, require detailed, fair invoicing that is easy for customers to understand.

Without automation, it will require, for certain types of offer, a large number of calculations with the associated risk of errors. A subscription management solution can automate all pay-as-you-go billing models. It will enable you to design invoices that are always fair and justified, and avoid errors associated with complex operations such as :

• The applicable VAT rate,
• Consumption or carry-over of usage,
• Calculating variable subscriptions for different offers, etc.

The entire invoicing process is optimised to improve customer relations and avoid recurring late payments.

5. Change scale

A subscription management solution is an undeniable asset in the day-to-day roll-out of your business. It allows you to accelerate deployment by concentrating on your core business, while reducing operational costs. By centralising data, you can better analyse your business and focus your sales efforts.

The tool should also enable you to win new customers by making it easier to design new offers, without complicating the process of managing new types of customer. It's a powerful tool that makes you more agile in winning new business.

Points to remember

The deployment of offers with a range of possible variations (from simple subscription to pay-as-you-go) makes automation almost indispensable. The recurring nature of the model's billing requires ultra-precise management.

In this context, a subscription management solution will enable you to :

• Speed up and secure invoicing by industrialising the process and guaranteeing compliance,
• Improve your cash flow with faster payment of invoices and automated dispute management,
• Reduce management costs,
• Concentrate on your business and grow it!

Sponsored article. The expert contributors are authors independent of the appvizer editorial team. Their comments and positions are their own.