The subscription business model is itself a profitable and revenue-generating business model, however, you need to opt for the billing model that can maximize your revenue growth. In the SaaS market, businesses are using various billing models to onboard more customers. Your billing model helps you with:
- Getting paid in time
- Attracting more customers
- Retaining the existing customers
And a lot more. SaaS businesses target to earn maximum revenue. And to maximize the revenue, it is important to know whether your billing model helping you or not. In this blog, we are going to tell you whether the flat fee billing model is for your SaaS business or not.
Flat Fee Billing Model for Simple Businesses
The flat fee business model suits startups and small businesses that need a simple billing model. Flat fee billing is understandable for customers. It is somewhat relevant to one-time billing. The customer comes to the retailer and he is charged a fixed rate. It is simple to understand that there is a fixed rate that the customer has to pay. The price cannot be negotiated because all customers pay the same. It is unlike the usage-based billing model where the customer is charged as per his usage. Companies opt for flat fee billing software to support this billing model.
Price Updation
When you opt for the flat fee billing model, you will probably need to update pricing frequently. Why? Because there are competitors in the market, you need to offer customers what is competitive enough so that you may not lose your customers. In case of opting for the flat fee pricing, you will need to update your prices frequently. So, when you opt for this billing model, be vigilant about it.
Hybrid Billing Model
Another option for the SaaS businesses that opt for flat fee billing is the hybrid billing model. Rather than just a flat fee, you can try other billing models along with the flat fee. This hybrid billing model will help you in diversifying the revenue stream. Prices usually work fine initially, however, with time, the competition increase in the market and business norms also change. You need to go accordingly. If you want to cater to more customers and earn more revenue, then test and try more billing models along with flat fee billing.
Your Revenue Driver
Pricing models are the revenue drivers. When you opt for a flat fee, you will have to keep an eye on different key performance indicators (KPIs) to see if your revenue driver is working fine. If your pricing model is not helping to generate enough revenue, then change your flat fee billing strategies. You can either go hybrid billing or some other pricing plan so that you can meet revenue targets.
Now, it is clear that flat fee billing is for simple businesses that have streamlined business operations. When you need to grow your business, you need to try other billing models as well. Why? Because you need revenue to grow SaaS businesses.
The revenue can be generated more with diverse revenue streams. And to diversify the revenue stream, you will have to try other billing models with the flat fee billing model. For instance, boxed subscription businesses can easily opt for a flat fee. However, when these boxed subscription billing businesses when try to establish proper eCommerce platforms, they need something more than just flat fee. The flat fee cannot work when it comes to onboarding a huge and diverse customer base.
If you are looking for software that can help you implement the flat fee billing model and keep the flexibility intact so that you can try and test other billing models as well, then SubscriptionFlow is the one. Here, the system is flexible enough to let you experiment with our pricing model.
