Most small business owners have heard the term "recurring billing", but few make use of it or know what advantages it can hold for their business. Let's start off with getting a precise idea of what subscription is and then move on to investigating how implementing it in your business can raise your cash-flow and save you money.
Subscription billing is when you give a merchant or service provider permission to charge your bank account or credit card at regular intervals for the purchase of goods or services. The recurrence can be for any period e.g. weekly, fortnightly, monthly, or annually. The subscription amount debited is usually the same on each recurrence, but can differ. For example an annual fee of $10.00 for your subscription to an online service.
Now that we know what recurring billing is, let's see how recurring billing can make your business better:
Enable positive cash-flow
If like many other business owners and freelancers you think that subscription billing is only for enterprise or corporate entities, you will be surprised to hear that subscription billing can work wonders for your SMME too. You can quite simply and very cost effectively implement subscription billing in your own small business.
Integrating recurring billing in your SMME means better cash-flow due to collection via debit order or automated monthly deduction. Most small businesses or freelancers allow their customers to pay via bank deposit or electronic funds transfer only. This means that your customers have the control over when they pay you. Sometimes resulting in sporadic small payments or even worse, late 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 predict 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.
Get your money on time
Recurring billing means timely payment. Customers can't forget to pay because now payment collection is automated. You don't have to wait around anymore for late payment or have to deal with customers claiming they forgot about making payment. You get your money when you require it - hassle-free. Customers still have the freedom however to select their own debit dates according to invoice due date, so everyone's happy.
Reduce administration
It does what it says on the box; subscription billing allows you to save money and your customer to save time. Clients no longer require to go to banks to make deposits or need to remember to login to online banking in order to make a manual wire transfer. That is all automated with subscription billing. You as business owner also save time on reconciliation of accounts and save money as you do not need to employ so many staff in your accounts department.
Sounds brilliant! Sign me up! Find the best resources for recurring billing systems online or ask other business owners for suggestions. We recommend signing up with a gateway that automates recurring billing and a payment facilitator that allows automatic account recon.
Subscription billing is when you give a merchant or service provider permission to charge your bank account or credit card at regular intervals for the purchase of goods or services. The recurrence can be for any period e.g. weekly, fortnightly, monthly, or annually. The subscription amount debited is usually the same on each recurrence, but can differ. For example an annual fee of $10.00 for your subscription to an online service.
Now that we know what recurring billing is, let's see how recurring billing can make your business better:
Enable positive cash-flow
If like many other business owners and freelancers you think that subscription billing is only for enterprise or corporate entities, you will be surprised to hear that subscription billing can work wonders for your SMME too. You can quite simply and very cost effectively implement subscription billing in your own small business.
Integrating recurring billing in your SMME means better cash-flow due to collection via debit order or automated monthly deduction. Most small businesses or freelancers allow their customers to pay via bank deposit or electronic funds transfer only. This means that your customers have the control over when they pay you. Sometimes resulting in sporadic small payments or even worse, late 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 predict 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.
Get your money on time
Recurring billing means timely payment. Customers can't forget to pay because now payment collection is automated. You don't have to wait around anymore for late payment or have to deal with customers claiming they forgot about making payment. You get your money when you require it - hassle-free. Customers still have the freedom however to select their own debit dates according to invoice due date, so everyone's happy.
Reduce administration
It does what it says on the box; subscription billing allows you to save money and your customer to save time. Clients no longer require to go to banks to make deposits or need to remember to login to online banking in order to make a manual wire transfer. That is all automated with subscription billing. You as business owner also save time on reconciliation of accounts and save money as you do not need to employ so many staff in your accounts department.
Sounds brilliant! Sign me up! Find the best resources for recurring billing systems online or ask other business owners for suggestions. We recommend signing up with a gateway that automates recurring billing and a payment facilitator that allows automatic account recon.
About the Author:
Susan Bapsnill is an expert at business billing. She suggests recurring billing to automate your billing procedures. Click here to try a recurring billing system for free.
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