Previously considered new nice-to-haves that helped some organizations stand apart from their rivals, subscription and usage-based services are now vitally favorable options in almost every industry. Businesses can forecast their finances and attract investors with the help of subscriptions, which also give customers convenient, ongoing access to their preferred goods and services. Usage-based models, on the other hand, allow users to pay only for the services they use, removing the revenue cap in the process and lowering entry barriers to attract new clients. Wins can be found in both models.
However, there is a catch: to fully embrace and profit from subscription and usage-based models, companies must abandon their in-house, legacy, or otherwise out-of-date billing infrastructure and switch to a system created with the complexity of these models in mind. Usage-based models need complex real-time data management since they have so many distinct inputs, variations, and variables, which traditional systems weren't built to handle. And although subscription models are an effective source of steady, recurring income, they are far from being the "put it and forget" convenience that many companies anticipate. And the subscription model will only promote churn when a company takes that ease of use for granted.
When Choosing a Billing System to Support Complex Billing, Consider the Following Features
What difficulties must a billing platform overcome to support these models? Here are just a few examples:
Internal Automation & Transparency
The sales representative who provides the initial quote, the legal team who finalizes the contract, the fulfillment team who ensures the client receives the goods or services, and the finance team who sends out invoices and collects payments are just a few examples of the many business departments that must contribute their time and effort to complex billing transactions.
Communication breaches between these teams' silos can result in mistakes, delays, and dissatisfied clients. For instance, the client might be offered a discount for the first three months by the sales representative, but the information may have been misplaced or muddled between the sales office and the finance desk. Either the customer doesn't get the discount they were promised and feels misled, or the discount remains in effect after it should have ended and the business loses money.
Complete transparency between all aspects of the business is necessary for a complicated billing model, as are automated workflows that reduce the possibility of data duplication, missing data, or other potentially expensive errors. A flexible billing platform created with expansion in mind can be a valuable asset to a subscription-based business, but older and legacy billing platforms frequently struggle to offer these features—especially as customer volume increases.
Data Mediation in Real-Time
Depending on the type of billing model in use, the specific regulations governing it, and any special agreements (such as discounts) any given customer may have, usage data for complex billing models can come in a variety of formats. Diverse usage data must be converted to pricing to determine revenue and give the customer an understandable invoice. The rating engine receives the data after mediation, which has normalized it and converted it into a bill.
In the past, mediation has been carried out either manually or by extensions of existing systems. And while that's perfect for a company with straightforward billing structures and low usage volumes, as structures become more complex—and volumes rise—manual procedures and rigid, antiquated systems can't keep up. They are no longer effective, and the potential for error is too great.
To improve customer relationships, back-office workflows, and revenue, the mediation process needs to be more effective. The process is automated by sophisticated intelligent billing platforms, which enhance the billing experience for clients and clients in several ways.
Product Catalog that is Modular
You'll need an easy-to-update product catalog because complex billing models—and the growth plans that go along with them—typically involve new goods, services, and offering bundles. While an intelligent billing platform's product catalog should be flexible enough to support evolving offerings, legacy, and manual billing systems require a billing specialist and manual intervention to update the product catalog. Manual updates frequently result in an overabundance of SKUs, customer confusion, and lost sales opportunities. However, when you can automate the procedure for updating price and billing as you update your catalog, you avoid data duplication, delays, and errors, enabling your company to launch new items and services faster than your consumers anticipate them.
Absolute Agility
Businesses need to be agile enough to change course quickly in a world where change is the only constant. For many devoted clients, such constant subscription may no longer be a possibility if a pandemic, for instance, completely changes the market. Or, in a recession where consumers are trying to stretch their budgets as far as possible, the current usage-based models may need to make way for new methods, packages, or pricing schemes. A company that can quickly change its products, prices, and business models will fare much better than one whose only course of action is to stick with it. Once more, in times of upheaval, manual procedures, Excel spreadsheets, and antiquated invoicing systems are a real liability. The right systems, on the other hand, enable businesses to be adaptable and agile, easily keeping up with whatever the market throws at them.
Work 365 makes complex billing simple.
There is no doubt that subscription-based services and usage-based services provide businesses and customers greater value, but the fact is that these demand billing solutions capable of handling complicated billing models. These approaches are taken into consideration while creating the Work 365 platform, which simplifies complex billing through automated workflows, intelligent usage and rating, transparency from quote to cash, a customizable product catalog, and many other features.
Work 365 is a recurring billing software and subscription billing management for Microsoft partners to streamline the quote to cash process.