The 7 Advantages of Automated Billing Software
Automated billing allows your SaaS business to manage more clients in less time and save thousands of dollars in the process. Every small business owner strives to acquire more clients. When you’re putting so much effort into this task, it’s essential to make the following steps smooth as well. The financial and administrative tasks ramp up quickly, and before you even notice, you’ll have to spend hours behind your desk, trying to manage all the paperwork effectively.
The first step towards maximizing efficiency is picking up an online invoicing software. It will allow you to set up automated billing processes, which is essential, particularly for SaaS businesses. Apart from the benefits, an automated invoicing system allows you to reduce risks significantly. For instance, according to research, a large percentage of UK businesses are at risk of mismanaging financial paperwork.
Cloud-based services are affordable and scalable, and that’s what makes them so attractive. However, in order to increase your revenue, you need to make it as easy as possible for customers to pay for recurring services while staying on top of your invoicing. This is an important reason why the majority of businesses in the US utilize billing and invoicing automation tools.
Here are the seven main advantages of billing automation tools.
1. Recurring automated billing
If you’re SaaS business, probably over 90% of your customers are billed regularly at the same date, each month. Having to draft and send the same invoice every time for each client is costly and time-consuming. This is especially true when your customer base is growing continuously. Online invoicing software allows you to set up automated billing and create professional-looking invoices and reuse them an infinite number of times. This feature enables you to lock clients in an efficient routine that helps them pay on time. At the same time, you provide them with an option to pay via a credit card or transaction.
2. Unlimited automated invoicing
When shopping for cloud-based accounting software, it’s important to think about the potential caveats. One such case is the pricing system of the vendor. For instance, some accounting tools charge you based on billing your clients, or the number of clients your company has. While this can be OK when your business is still small, it won’t scale efficiently as you acquire more customers. These types of pricing mechanisms endorse hidden fees once you exceed the limit of invoices you could send per month. Needless to say, that amount can escalate very quickly.
However, automated billing software like Freshbooks charges you on a per-user basis and offers unlimited invoicing and customer support. This way, you won’t have any problems with sending out extra invoices ahead of time or worry about overarching fees.
3. Automated reminders
Sending invoices is one thing, making sure that customers pay on time and schedule is another. Tracking down and identifying late payments is a daunting task. Moreover, it gets worse the more customers you acquire. On the one hand, you don’t want to risk missing payments. On the other, you want to preserve good relationships with customers to improve customer retention.
Automated reminders can be configured to automatically send notifications to users on pre-defined dates to ensure that there will be no problems with the payments. Depending on each case, you can choose to send notifications three to five days before the payment is due, and three to five days after the invoice is overdue. It’s a professional and efficient way of communicating with customers to avoid any future inconveniences and build long-lasting relationships.
4. Automatically applied discounts and coupons
When working with hundreds of customers, it can become insanely difficult to try and offer a personalized approach to each. For instance, imagine you’ve conducted a marketing campaign. You have promised a discount to the first 20 customers who’ll buy your services for the next six months if they agree to sign an annual contract. Instead of trying to remember which exact people should be included in the promotion at the end of each month, you can configure your automated invoicing system to apply the given discount for the first six months of automated billing. Easy, simple and efficient.
5. Automated tax calculations and payments
Taxation is an important topic for any organization. One may be an experienced business person, but when it comes to tax calculations, things can get extremely complicated. If you’re operating in multiple jurisdictions at once, it gets even messier. Moreover, tax regulations are constantly subject to change. If you’re not careful, you may be losing a lot of money due to being misinformed or having outdated information.
A well-rounded automated billing software like Tipalti can help you easily calculate and pay your taxes. And the best part is, you don’t need to bother yourself staying up to date with the latest changes since the vendor includes any changes that may have occurred, which apply to your business.
6. Multi-currency billing
When operating in an international market, it’s important to be able to invoice customers via their native currencies. While you could get away by charging US dollars for everything you do, having native currency support adds credibility and professionalism to your services. Marketing-leading automated invoicing tools like Quickbooks support multiple currencies and offer competitive transaction fees for currency conversions.
With this feature, you can set up a recurring invoice in the currency of your choice and later exchange it at a low rate directly through the software. Naturally, all this information will be stored and can then be analyzed, which brings us to the final perk.
7. Automated reporting
After configuring the automated billing software for the daily tasks, you can use all that information to get a clear view of the big picture. Most online invoicing tools grant you access to automated reports and analytics, allowing you to analyze information including total amount billed for the given period, the amount of past due payments (per client), total amount you’ve spent on payment fees, detailed sales tax data, time spent on a project vs. hours billed, and so on.
Generally, the reports are customizable to a high degree, meaning that users can pull out any information for a given period, project or customer. Smart business owners use this information to continuously revise and adapt their business, marketing, and sales strategies and internal processes to increase profitability even further.
Overall, automated billing and online invoicing is an essential piece of software for every small business owner. The convenience and the time and money that you save on repetitive tasks alone make it a worthy investment. Moreover, the additional functionality offered by market-leading brands allows you to make informed decisions and continuously improve your business strategy and quality of service, at an affordable price.
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