Taija Engman, CEO of Good Sign accompanied by Bea, the dog, continues her lakeside video blogging about 5 most common pain points in service billing. This second video is about Revenue Leakage, which is a huge challenge in many companies in recurring revenue business. Click the video to watch.
Revenue leakage is the most common problem in service billing
Revenue is leaking because of all the services given are not billed correctly.
In recurring revenue, it is not as easy as in product business to trace all services given to the customer. And its is not easy assuring right prices, taking into account change management, volume steps and time periods, for example:
- 1 million of billing may easily be missing from the top line for each 20 million of recurring revenue when using the current processes and systems.
- This pain increases when comparing this missing 5 percent of revenue to how much effort is needed for equivalent 5% more from new sales.
- And also, missing billing causes the same amount, 1 million, of missing profit.
To capture all billing items correctly, start at the root of the problem: ensure your billing system can cover all billing items from day one.
The 5 COMMON PAIN POINTS
Based on our experience, businesses usually find that at least 2 of these pains apply to their recurring revenue businesses. Often 3 or 4 of these pains exist.
- Revenue leakage eats growth and profits
- Too much manual work and slow cash flow
- Slow time to market with new offerings
- Billing problems hurt customer satisfaction
- Challenges in transparency and IFRS/GAAP compliance
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If you want to know more about these pains, stay tuned for the next episodes. Taija will talk about each of the five pain points. When you want to solve your challenges in recurring revenue, make us keep our promise that our software can remove these pains from your business.
TAKE US TO THE TEST
If you feel your pricing and billing needs will outgrow your current billing solution, or if you are just curious to learn how Good Sign does things differently, feel free to take us to the test! We will gladly take on your challenge and prove to you it can be done. Scalability for your next business opportunity is closer than you might think.
We help our customers solve existing pain points in monetizing service contracts and managing subscriptions and pay-per-use services. We help companies freely grow scalable services.
Feel free to contact us and let’s have a chat on how we can support your company.