5 reasons to use a subscription management solution

The subscription model is on a roll! In all sectors, more and more companies are trying out this model. They open up to new customers while capitalizing 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 litigation management can become extremely time-consuming. What's more, the lifecycle of our 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 away from the hustle and bustle, and focus on developing your business.

1. Centralized 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. For example, thanks to an industrial process, archiving becomes instantaneous and reliable, with a complete billing history. All invoices are made available to customers, and can be consulted and downloaded from a dedicated customer area.

Data centralization also enables you to concentrate your efforts where you need them most, thanks to a more precise analysis of company data. The time you save is invaluable, both for your cash flow and your motivation.

2. Process automation

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

When it comes to calculating invoices, you need a pricing engine that evaluates the amount of subscriptions in real time, whatever the complexity of the model: variable pricing, consumption-based billing, paid options, etc. It makes all adjustments to the invoices, including the calculation of the amount to be paid. It makes all adjustments for delicate operations such as changing offers or adding options, and calculates the amount of taxes based on billing information and current legislation.

All information is now directly linked. Complex operations are simplified. The automation and security of recurring invoicing means you can scale up to handle a larger number of subscribers.

3. Litigation management

The specificity of the subscription sales model is recurring payment. Unlike the e-commerce model, and pending implementation 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 payment failures.

This is where a tool can be used to manage 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 churn. Thanks to an automated dunning process, 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 gain in cash flow and a guarantee of optimized customer relations.

4. Deferring usage, variable subscriptions and calculating taxes

One of the levers for avoiding late payment is the invoice itself. A poorly drafted invoice is a poorly paid invoice. Subscription-based sales models, and in particular pay-per-use models, require detailed, fair and comprehensible invoicing.

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 automates all pay-as-you-go billing models. It will enable you to design invoices that are always fair and justified, and avoid errors linked to complex operations such as :

• Applicable VAT rate,
• Consumption or deferred usage,
• calculation of variable subscriptions for different offers, etc.

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

5. Change scale

In day-to-day business, a subscription management solution is an undeniable asset. It enables you to accelerate deployment by concentrating on your core business, while reducing operational costs. By centralizing data, you can better analyze your business and focus your sales efforts.

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

Points to remember

Deploying offers in a variety of forms (from simple subscription to pay-per-use) makes automation almost indispensable. The model's recurrent invoicing requires ultra-precise management.

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

• Speed up and secure invoicing by industrializing the process and guaranteeing compliance,
• Improve cash flow with faster invoice payment and automated dispute management,
• Reduce management costs,
• Focus on your business, and leverage it!

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