Why (and How) Successful CFO’s are reinventing their Billing System
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Successful CFOs are reinventing billing systems to improve revenue collection for subscription businesses, which face challenges with traditional systems that are slow and inaccurate. Key benefits of automation include enhanced payment processing, scalability, and improved analytics for customer performance. The document highlights Fusebill as a solution that streamlines these processes, allowing businesses to efficiently manage subscriptions and billing complexities.
Why (and How) Successful CFO’s are reinventing their Billing System
- 1. Why (and How) Successful CFOs are Reinventing their Billing Systems February 4, 2013 Steve Adams
- 2. • Subscriptions aren’t just for newspapers… – Examples of Retail Subscriptions • Challenges of implementing subscriptions • 5 Benefits of Automation • How Fusebill can help – Quick Demonstration
- 3. The expanding Subscription World
- 4. It’s one of the simplest of truths For a subscription business to make money, it must bill and collect from customers. make money bill collect
- 5. Too bad it’s simpler to say than do Traditional systems are slow, inaccurate and unable to scale The devil’s in the details of requirements and architecture.
- 7. Advertise Web Visits $$$$$ Conversions Build Repeat Business One Decision – multiple orders
- 8. Order Linear Processing Flow Linear ERP Systems Transactional •Online •Customer Service Get Paid •Credit Cards •Invoices •PayPal Ship • Inventory • Fulfillment • Shipping
- 9. Transactional back office systems fail Recurring Billing Initial Sales Process Renew Upsell Crosssell Traditional transactional systems don’t support recurrence Multiple Concurrent Subscriptions Usage Based Charges Credit Card Expiry, Fraud, etc. 9
- 10. So What Happens? • Improvisation – Track in Excel – Ticketing systems • Pilot Projects Security Risks Errors & Revenue Leakage – Quick and Dirty development projects • Or long and twisted development projects Lack of Visibility Barriers to Scale Offline Accounting
- 11. Accounting • Accurate Taxes • Discounts, Write-offs • Earned vs Deferred Revenues • Cash vs Revenue
- 12. Security Services - Product Bundling Example • Hardware – Delivered when project starts – Invoiced (30 day terms) – Revenue recognized on shipment • Integration project (development services) – Paid in installments – Recognized over life of contract • 12 month subscription – Paid quarterly, in advance – Recognized over contract
- 13. Complexities of Bundling & Revenue Recognition Ship & Earn Revenue Hardware Earn Revenue Monthly Collect Subscription Collect Quarterly Delay Start Win Integration Services Active Cash Effort Earn Revenue Monthly Integration Services
- 14. The key benefit of automation is automation… • Process Payments – Automate collections, retries, client notifications • Process renewals – and expiries • Reduce people power – increase ability to scale • Outsource security issues – Note that most shopping cart platforms don’t store credit cards
- 15. Accuracy • Get paid before shipping – Properly calculate amounts (discounts, coupons, taxes) – Collect automatically • Notify downstream systems of problems! – Invoicing and Account statusing • Ship the right things – Manage change – Customer self-service – Central view of customer orders • Stop delivering …
- 16. Agility – cope with pricing changes • Pro rating • Upgrade Options • Variations • Promotions / Coupons • Customer lifecycle: – Cancel – Renew – Options
- 17. Analytics • So, what are we selling anyway? • What geographies are performing well? • What online programs bring us long term customers? • How long do customers subscribe for?
- 18. Brief Demo – Monthly Soap Delivery Basic offering – soap and shampoo Premium Plan – Salon quality soaps Options to purchase extra or upgrade
Editor's Notes
- #6: V/O: Subscription billing is far more complex than it sounds. What happens if a credit card fails. Is a customer automatically shut off? Is there some grace period? How are calls to customer service handled? What about upsells or price changes? If a system is built incorrectly, all these little issues and requirements compound in an ever-growing mess of spaghetti code.