Did you know that the estimated global market value of SaaS companies in 2021 is around $ 123 billion? While these stats show that SaaS is the most expanding industry, many startups take their company’s payment processing for granted.
Ideally, a standard SaaS Company will provide their customers to pay via recurring or subscription billing, but the pricing model may vary from business to business.
When it comes to the payment processing for SaaS, many companies find themselves stuck with challenges and pitfalls. So to get you to the success, here we have compiled the list of 8 SaaS billing challenges and how to overcome them:
Client Retention and User Experience:
Providing a seamless customer experience is the most important thing that SaaS organizations need to consider. A tricky user interface, irresponsive website, and difficult payment methods can be quite frustrating for customers.
One non-working thing can have a negative effect on your business. However, you need to streamline your revenue process to keep your clients satisfied. You need a SaaS billing system that removes the complexity out from the system management.
Keep your customers engaged:
Irrespective of the credit card processing industry, keeping communication open with your customers is important for building long-term relations. In the SaaS billing world, where a complex pricing model is a norm, your clients may struggle to get the information they need. This further makes it difficult to handle payments, make purchase decisions and manage accounts.
By introducing an intuitive self-service portal, you will be able to share the information with your clients, which will help in building loyalty between your brand. Empowering customers with self-service enhances the client’s relationship and helps in lowering the cost to let you operate more efficiently.
For instance, the right SaaS billing system will allow customers to view account information and usage. This will minimize the need to have an extra resource and reduce the calls that come to your contact center.
Gathering the electronic payments globally:
With SaaS companies working with customers worldwide, having a reliable and global payment processing service that handles regulations and customers’ preferences is challenging.
Therefore SaaS companies need a wide range of currency options that can easily integrate with third-party apps. Also, to ensure that your expansion adheres to the internationalization objectives like your customer and revenue growth, your billing system has to support various languages, currencies, tax providers, payment providers, and more.
Adding fixed pricing plan:
Your customer needs are as big as your customers; therefore, you need to add cost-effective design and your pricing values. With complete flexibility, you will be able to support all types of pricing models. Moreover, a comprehensive SaaS model will provide a point-and-click configuration combined with a workflow to let you include the most competitive pricing strategies.
Identifying revenue for SaaS companies is not as simple as it looks for most of the traditional business models. Instead of just adhering to the rules, you also need to consider the revenue time, billing methods, upgrades, contractual commitments, subscription additions, downgrades, and more.
A SaaS billing system that combines both billing and revenue recognition streamlines revenue management by making financial transactions and executions in real-time.
Accelerating the delivery of invoices:
With hundreds of thousands of customers, just managing the sheer number of invoices can overburden finance leaders. And, when invoicing contains errors or is delayed, or is not sent, your ability to collect revenue gets hampered.
However, a billing system that increases accuracy and automates invoice for payment processing for nonprofits also eliminates this labor-intensive task and brings your SaaS company on track to collect the revenue you’re due.
Expanding your footprint globally:
When taking your business globally, there are various considerations you need to keep in mind. The most important one is to ensure that your SaaS billing should support localization; this will help in identifying the customer and revenue growth. Also, the billing system must support multiple languages, tax providers, regional regulations, and more.
Another main issue with payment processing is churn reduction as many customers get lost because of missing or expired card details. Therefore, considering the high cost of having new customers for SaaS businesses, having a billing solution that minimizes the chance of losing customers is quite beneficial.
Also, by adding customization to the user experience and by adopting a platform that manages payment processes, SaaS companies can minimize the risk and allow customers to make payments in a simple manner.
Short-term sales programs like promotions, coupons, and discounts help grow clients and boost loyalty. If you are using a legacy system or trying to implement incentives manually, chances are you may end up spending thousands of dollars every year.
A centrally managed billing platform takes the manual effort out of sales programs, enabling you to combine promotions with your products and services automatically. This way, you can quickly, efficiently, and cost-effectively drive sales and revenue.Business & Finance Articles on Business 2 Community