So you have heard about subscription billing, but think it's only for big enterprise type businesses. Did you know that you can apply subscription billing to your SMME to improve your cash-flow and give your clients a truly easy way to pay? Before we look at how recurring billing will benefit your business, let me walk you through a basic definition of what subscription billing actually is:
So, subscription billing, what is it? Subscription billing will charge an amount repeatedly to your credit card or bank account. The amount is usually the same and recurs on the same date each month. But subscription billing can also happen for varying amounts on any term or frequency on any date. Recurring billing is prefect for bills that never change in amount, for example: A monthly subscription to your favorite magazine.
Now that we know what subscription billing is, let's see how recurring billing can make your business better:
Keep the cash rolling in
Businesses and freelancers stand to benefit a lot from adopting recurring billing procedures. Subscription billing is not just for large or enterprise type businesses. Any business can easily and very cost effectively implement this strategy.
Implementing recurring billing in your SMME means better cash-flow due to collection via debit order or automated monthly deduction. Most businesses or freelancers allow their clients to pay via bank deposit or electronic funds transfer only. This means that your clients have the control over when they pay you. Sometimes resulting in sporadic small payments or even worse, untimely payments.
This means you are unsure of your cash-flow. This in turn leads to you not being able to plan in advance. Not being able to project what your income will look like over the next few months will prevent you from being able to schedule your own debits and plan the growth of your business.
Don't forget to remember
Clients who neglect to pay their invoices on time can seriously affect your business. Waiting for late payment is very negative. Subscription billing eliminates the need to wait for late payment and because it happens automatically means the customer does not need to remember to actually pay you each month. It's a great way to collect hassle-free on time payments.
Reduce administration
Ensuring the bulk of your customers pay via subscription billing translates to reduced administration tasks for you and your customers. Administration is less on the customers side because payment is automatic. The customer no longer needs to go into a bank to make a direct deposit or login to Internet banking to manually make a wire transfer. Administration is also less on your side because you do not have to recon hundreds of small individual payments. Gateways that allow for recurring payments usually offer automated account reconciliation or provide bulk recon files that allows easy and accurate resolution.
Wow, that sounds great! But how do I get started? Joining a payment gateway and payment facilitating system is step one. Find a gateway with competitive fees and a facilitator that allows automatic account recon.
So, subscription billing, what is it? Subscription billing will charge an amount repeatedly to your credit card or bank account. The amount is usually the same and recurs on the same date each month. But subscription billing can also happen for varying amounts on any term or frequency on any date. Recurring billing is prefect for bills that never change in amount, for example: A monthly subscription to your favorite magazine.
Now that we know what subscription billing is, let's see how recurring billing can make your business better:
Keep the cash rolling in
Businesses and freelancers stand to benefit a lot from adopting recurring billing procedures. Subscription billing is not just for large or enterprise type businesses. Any business can easily and very cost effectively implement this strategy.
Implementing recurring billing in your SMME means better cash-flow due to collection via debit order or automated monthly deduction. Most businesses or freelancers allow their clients to pay via bank deposit or electronic funds transfer only. This means that your clients have the control over when they pay you. Sometimes resulting in sporadic small payments or even worse, untimely payments.
This means you are unsure of your cash-flow. This in turn leads to you not being able to plan in advance. Not being able to project what your income will look like over the next few months will prevent you from being able to schedule your own debits and plan the growth of your business.
Don't forget to remember
Clients who neglect to pay their invoices on time can seriously affect your business. Waiting for late payment is very negative. Subscription billing eliminates the need to wait for late payment and because it happens automatically means the customer does not need to remember to actually pay you each month. It's a great way to collect hassle-free on time payments.
Reduce administration
Ensuring the bulk of your customers pay via subscription billing translates to reduced administration tasks for you and your customers. Administration is less on the customers side because payment is automatic. The customer no longer needs to go into a bank to make a direct deposit or login to Internet banking to manually make a wire transfer. Administration is also less on your side because you do not have to recon hundreds of small individual payments. Gateways that allow for recurring payments usually offer automated account reconciliation or provide bulk recon files that allows easy and accurate resolution.
Wow, that sounds great! But how do I get started? Joining a payment gateway and payment facilitating system is step one. Find a gateway with competitive fees and a facilitator that allows automatic account recon.
About the Author:
Susan Bapsnill is an expert at business billing. She recommends a subscription billing system to automate your billing procedures. Click here to try a subscription billing system for free.
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