If you find your profit margins to be lower than expected, a number of factors could be at play. It may be due to a dip in repeat customers or difficulty in recruiting new clients. The profit loss could also be traced to recurring billing problems that have not been addressed, resulting in unhappy customers and a sinking bottom line.
Businesses must take steps to explain their billing processes. Customers must clearly know how much they will pay for goods and services and how frequent they will be charged. They must understand cancellation policies and be reassured that their credit card data will be safe with you.
The following are common billing problems that companies encounter and some ways to address them:
User management – Companies must effectively manage their users by keeping track of and maintaining updated records. The company’s recurring billing solution must effectively categorize sign-ups, activations, trials, upgrades, or downgrades in order for customers to be billed correctly.
Automatic invoicing – Invoicing can be a sizeable headache when you have a large customer base. This situation gets even worse when customers have signed up for different levels of services at different periods, which will necessitate different invoicing dates. An automatic invoicing system will remedy the problem.
Variable pricing tiers – A company will have different pricing levels for different types of services. The presence of multiple pricing tiers usually results in invoicing confusion. An effective management system for pricing plans should be in place to prevent any mistakes or confusion in invoicing.
Discounts and promotions – If you offer incentives and promotions, you can attract more customers, but managing these different pricing structures can be a headache. An automated system will include effective management of discounts and promotions, together with their expirations, to make invoicing smooth and error-free.
Support for foreign customers – If you provide service in foreign countries, you will encounter another layer of challenges. People may speak in different languages and pay with different currencies. The company’s billing system must support these currencies and must have language support for non-English speaking customers.
Integration of payment gateways and shopping carts – For a company providing service worldwide, the shopping carts must be integrated with various payment gateways. A universal payment gateway may sound nice, but it may not work due to the economic and banking policies in other countries.
The use of software to automate a company’s recurring billing will eliminate the common problems that result in customer loss and failure to attract new sign-ups.