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3 BELIEFS that Eat Margins and Growth in Service Business

Jan 23, 2020 1:50:00 PM

Make billing transparent to your customers. Don't rely on a crystal ball for truth!

Photo: Aleksi Friman, Calcus.comGood Sign_Taija Engman

“Companies often rely on some manual steps in pricing and billing of recurring revenue streams. This causes errors and decreases customer satisfaction. It's like trusting a crystal ball for truth.”

Our CEO Taija Engman discusses how to solve service business pricing and billing challenges and points out 3 common beliefs companies have that eat margins and growth:

1. BELIEF: Billing is not a problem – OUR BILLING PERSONNEL/DEPARTMENT HANDLES that

When any billing department collects information about service usage and manually assures correct rates and prices, there will remain revenue leaks, errors, and redundant manual work. Customer complaints cannot be avoided either.

“Solution to these pains is to digitalize customer contract rules and pricing. Eliminating any manual step in the billing process will bring a significant improvement in both revenue and profit. Often, for example, 5 percent of revenue has leaked. Also, customer satisfaction improves," summarizes Engman

2. BELIEF: New services can be provided USING existing systems

ERP systems were created for the product business, not for the modern service business. Such a system does not provide for managing continuous services, and oftentimes Excel is required to consolidate and reconcile user information.

“Software designed for the modern recurring services enables short time to market for new kinds of services, and pricing change management is quick. This improves competitiveness and all elements of the service will be billed correctly, ” continues Engman.

3. BELIEF: IT's TOO EARLY FOR US to invest in billing automation yet

When billing leaks, earnings and revenue will suffer. Without service billing software, the situation will not improve.

“Automation is not an investment. Instead, a software that fits the purpose, pays for itself quickly back. And automation is worth doing right away, ” says Engman.

Staying behind these beliefs does not offer competitiveness. Active decision making is called for.

Now, leave the crystal ball in history and start solving your pains of service pricing and billing with automation. We at Good Sign can help you.

Want to learn more? Read our blog post 10 Reasons You Should Invest in Flexible Pricing and Billing

Contact us, and have a chat with our experts on how to improve your business!

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The story is based on Taija's interview article in Talouselämä, a Finnish business magazine, in January 2020. 

 

Anitta Maltela
Written by Anitta Maltela

Marketing Manager at Good Sign Solutions

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