5 Things to Look for in a Subscription Management Software Review

You're being held back by your labor-intensive manual billing procedures.

You are well conscious of the issue. And you believe that automation is the solution: relieving important team members of monotonous tasks will free up their time to support your business's growth as intended—and beyond!

Your business case is flawless now. To senior stakeholders, it was presented.

Now look at us. The time has come. You finally get the go-ahead! The good part is about to start. The search for brand-new subscription management software has begun.

Unfortunately, it's not all free trials and good times. This significant purchase is a big deal; it necessitates fundamentally altering current procedures and does not necessarily involve a small investment. This choice will have some effect on your entire department of revenue operations. The stakes are high for accuracy.

However, you can take heart—help is close at hand! So, gather your short selection of products and begin your voyage of software evaluation. We'll help you determine which option is best for your company. Here are some expert hints for specific queries you should pose to potential suppliers along the road.

1. What happens if I invoice for more revenue than I expected throughout the year?

Subscription management software is primarily made to manage customer payments and automate recurring bills. And as your firm expands, so do your needs for billing. To put it another way, rising annual recurring revenue (ARR) denotes growing use of your subscription management system. Therefore, it makes sense that billing software providers base their prices on the amount of revenue you invoice.

You might be on a basic plan with a monthly fee of $199 if your subscription business bills less than $500K in yearly revenue, for instance. The next level plan would be yours whenever you reached the $500K mark. The price of one, let's say, is $499.

Imagine that you were to begin with the most basic plan, with a $450K projected ARR. However, your sales team is blazing! You're having a fantastic year, and, in just six months, you've surpassed your $450K revenue target. You have an impressive $800K in invoices at the end of the year. Well done.

awesome, right? Okay, sure. There is however more to it. In the subscription management industry, certain major providers impose overage charges.

As a result, if you invoice for more than what is allowed in the revenue band, the vendor will take a portion of that money, thus punishing you for expanding your business. The cost is often in the range of 0.5% to 1%.

A 1% overage fee in our scenario would cost $3,500. Not much, but nonetheless an odd punishment for developing more quickly than anticipated.

When your contract is up for renewal, a company like Work 365 would merely bump you up to the next pricing tier.

2. Can you work with the other components of my tech stack?

By itself, billing automation saves your AP team a significant amount of time—up to 40 hours per month, which can be used for other important tasks.

However, that is merely the tip of the iceberg. The entire integration possibilities of your subscription billing software, whether native or through API, should be utilized to maximize efficiency.

If your subscription management software could interface with components like your, think about the effects it might have on internal procedures:

CRM software streamlines the data flow from prospects to customers.

• Utilizing an ERP system will allow your finance team to track payments, upload invoices with ease, and synchronize information for more accurate data.
• With the use of tax software, you may comply with ASC 606 while navigating the minefield of state-specific tax rules in the US and abroad, potentially saving yourself tens of millions of dollars.
• Payment gateways that accept additional payment methods enable more swift and effective cash inflow.
• Wearables, vehicles, equipment, and other IoT devices
• Your SaaS solution streamlines usage tracking, makes way for usage-based charging, and links billing activities to in-platform triggers.

Therefore, you should consider integrating your entire fintech stack for more seamless operations in your subscription-based business. And you'll want to start out by choosing wisely. It would be a major hassle to roll out a subscription management system throughout the entire company only to discover that it isn't compatible with a critical component of your tech stack or that its API is inadequate.

3. How simple is it to modify a customer's plan or the catalogue?

A relatively flexible catalogue is a feature of any current subscription management solution worth its salt, but some do it better than others.

It's difficult to fathom a subscription-based business today that doesn't plan for:

• Introducing new features or goods
• Experimenting with various pricing schemes or models,
• Offering a combination of one-time purchases and subscriptions, or
• Transferring clients between plans.

You require a subscription management software with outstanding catalogue flexibility for these items. You can adapt subscriptions to each client's particular demands if you have the tools to customize price or packaging at the consumer level. You now have a significant competitive advantage, particularly in B2B sales.

Agile catalogues also clear up billing-related muddle. You don't need to use a workaround to enter sales that don't fit into your pre-planned schedules, like naming add-ons wrongly or treating them as a distinct subscription. Customers who don't recognize the line items could become irritated by situations like that, and it contaminates data and practically ensures false reporting.

4. Do you help customers reduce their payment processing costs?

Utilizing a recurring revenue model entails routinely collecting recurring payments from customers. Additionally, because billing occurs repeatedly, credit card processing fees become a common and unavoidable annoyance. They can become very expensive very quickly at 2%–4% per transaction.

Although there is no way to completely avoid this expense, you can save some money by finding out whether potential subscription management vendors have any special arrangements with preferred payment gateways.

A subscription management tool with a built-in payment mechanism is an even better choice. Most the market's subscription billing solutions don't provide this.

But how would signing with one who does help your company? You are a more valuable customer in the vendor's eyes. Why? In essence, you want to purchase not just one but two of their goods. You might stand to gain from

• Price aggregation

and

• A payment processing subscription model that is more dependable and cost-effective than the typical fee-based one most gateways provide.
• Overall, you might notice enough cost savings to make the product profitable!

5. How flexible are the pages you host?

Simple improvements like a hosted self-service portal and registration page can greatly enhance the customer experience. By managing subscriptions on a self-service site, customers gain control. A recent Frontegg study found that 77% of respondents said they prefer to use self-served SaaS applications. Microsoft data support the assertion. According to a study by Microsoft, 65% of respondents from around the world have a more favorable opinion of firms if they have a mobile-friendly customer support portal. The percentage is 79% among millennials, which is considerably higher. People want to handle their problems on their own whenever and whenever they please.

It prevents revenue leakage and eliminates the hassle of picking up the phone to do simple things like update card details or adjust plan features to suit their changing needs.

However, the ability for customers to manage their own subscriptions has advantages for all parties involved. Additionally, it lessens the workload for your support staff, giving them more time to concentrate on initiatives that will spur business growth. Although they should be hosted by your subscription management software, these pages should be editable to match your branding and the unique requirements of your company. Will different customer segments, for instance, have access to tools? What level of management will they have over their subscription? The many possibilities for payments, including method and frequency, and how they will need to mirror your pricing plan, are other items to think about.

If you want to earn the trust of your visitors and give them a satisfying browsing experience, you must customize the features of your hosted pages. For instance, having control over page layout enables you to optimise the user experience, which can boost conversions and have an impact on your revenue. Customers will feel reassured and confident about your brand because of the customised use of colours and designs, which is an important measure for subscription-based businesses.

Finally, your hosted pages must adhere to the highest level of PCI-compliant data security because they will collect sensitive customer information like contact information and billing details.

Choosing the ideal subscription management tool for your company

It won't be as easy as comparing prices online and signing up for subscription management software for most cloud-based subscription firms.

A recurring billing platform can do more than just automate invoicing and reduce administrative work. It's a comprehensive subscription lifecycle management system that will become crucial to the smooth running of your company and a turbo-charged engine for epic expansion.

You should be able to fine-tune your selection procedure and narrow down your shortlist of vendors using these five questions. Your chosen candidates ought to provide ASC 606-compliant revenue recognition, sophisticated financial reporting, subscription analytics with data-driven insights, adaptable hosted pages, a variety of integrations, catalogue flexibility, transparent and reasonable pricing, lower payment processing fees, subscription analysis, real-time revenue tracking, and a full complement of cutting-edge subscription management tools.

Finally, you should be prepared to choose the appropriate high-impact software, such as video editing software and more, when it comes time to make a purchasing decision to significantly improve every aspect of your subscription-based business.

Work 365 offers subscription billing best practices and SaaS billing software to streamline recurring revenue and billing invoicing processes.