The article talks through what small-to-medium-sized businesses (SMBs) have to gain from bringing a subscription model onboard. It also highlights some of the obstacles that transitioning to a subscription model can bring, as well as advice on how to overcome them. And finally, it makes recommendations for solutions that can take care of these stresses so that SMBs avoid overburdening themselves. In this article
What Subscriptions Can Bring Your SMB
How to Get Ready for Subscriptions
One Thing Can Do It All For You
What Dynamics 365 Business Central + Bluefort Does for You
It can be extremely challenging to run a small-to-medium-sized business. Stretched resources, competition, and a host of other problems can contribute to shaky revenue.
And that’s the last thing an SMB needs.
Most of the time, a great product offering isn’t enough. You need to be able to offer your products in the way the customer wants to buy them.
And for a lot of businesses, that means subscriptions. But if you aren’t used to a subscription model, it might feel a little overwhelming. How do you know where to begin? Or figure out which type of model is right for you?
That’s why we’ve written this article. Not only are we a subscription company, but we work with SMBs that offer subscriptions. We understand the issues and approaches that can work best.
We also know how subscriptions can enhance your business and boost your bottom line.
Keen to find out more? Read on.
What Subscriptions Can Bring Your SMB
You might suffer from the most common problems SMBs face, including unstable revenue, high customer churn, a lack of predictability, and not connecting with your customer despite your best efforts.
Fortunately, these are things that subscriptions can help solve.
Here are some of the benefits that subscriptions can bring to your business:
1. Customer insight that will help you reach them where they are: Sometimes understanding what customers want feels as easy as throwing darts blindfolded.
Customers can be fickle. They can be easily poached. They cost money to get or keep.
But there is a cheat code- your customer data. Harnessing data helps your business because it gives insights on demographics, preferences, buying habits and behavior, and feedback. It puts you in your customers’ minds.
Data gives the information you need to personalize your offerings and effectively communicate with them. 2. Customer convenience, loyalty, long-term value: Subscriptions also bring value and convenience. Customers don’t have to remember to nip to the store, or re-order, or try to remember which website they bought what from. The products just show up.
And subscriptions bring even more convenience with self-service customer portals, which give them the opportunity to control their accounts, what they have, what to order, and what to add-on. That relieves pressure off your sales team.
You can also offer a loyalty program that will keep your customers feeling engaged and appreciated.
Because subscriptions have a long-term customer relationship built into the concept, it’s a great chance to show them the value of your products/services and your brand. There’s a far better chance of lengthening your Customer Lifetime Value, which will bring in a lot more revenue.
3. Stable revenue: Inconsistent sources of revenue, like the kind you get from one-off purchases, make it really tough to predict when money’s coming in.
And that has multiple knock-on effects. It’s harder to rely on your numbers and future projections. It makes strategic decisions tough. It can create supply chain problems, because when you can predict what you’ll sell, you’re vulnerable to over and under-selling.
But with subscriptions, you’ll have a revenue stream that is consistent and much easier to predict. That means better cash flow management.
That guaranteed income makes it more possible (and easier) to meet your own bills and reinvest in your business.
You’ll be far more likely to get off the financial rollercoaster.
4. More selling opportunities: Subscriptions give additional opportunities for revenue that you don’t see in one-off purchases.
There’s a wide range of options you can offer your customers including upselling and cross-selling, upgrades, changes in plans to better meet needs. All of these are great opportunities to continue to show the value of your brand, and to boost your CLV. 5. Scalability: You know what it’s like to be pinched if too many customers make too many one-off purchases at the same time.
It’s not like that with subscriptions, as long as you have your subscription management down. Though there might be small changes like upgrades or add-ons here and there, for the most part you’ll know where you stand.
So when new customers jump on board, you’ll know what’s expected of you and your teams. You can expand offerings across your country, greater regions, and internationally without needing a huge amount of investment.
And you won’t get that panic caused by stock problems.
These benefits sound great, right? And this is just the beginning.
But if you’re now more interested in bringing subscriptions, your thoughts will probably turn to how to get your SMB ready to bring in the model.
How to Get Ready for Subscriptions
There are a few things you can do to prepare for subscription success
To confirm that your SMB is ready, discover what your customers want. You can do this through personalized messaging, wider surveys, and even focus groups. These can help you find out what types of product offerings, terms, and subscription models will appeal most.
No matter how small or large your SMB team, they’ll need to be prepared and ready for change. Subscriptions operate in a different way, and although they are more stable and predictable than one-off sales, they will require some adaptation. So have a closer look at:
inventory management and fulfilment
ability to scale
subscription management including sales, customer service and finance teams ready
billing, payment, and reconciliation processes
reporting and strategy processes
knowing which types of pricing models will work best with your products and customers.
It’s important to be aware which subscription models you’ll choose. And whatever the nature of your products and services, your customers will need to know about them. Whether these customers are in your fold already, or you’re aiming to acquire them, they will need to be confident about your offering’s value. That means that even if your SMB is smaller, you’ll need a strong strategy for marketing and customer support on hand.
Of course, it’s also important to check what kinds of regulatory and compliance issues will arise. And not just for your industry; the recurring billing and customer data protection guidelines have to be clear, understood and heeded.
Clarity is a non-negotiable. Contract terms, including cancellation policies, need to be as transparent as possible to avoid legal complications.
And similarly, subscriptions bring the complexity of recurring billing and consistent recognized revenue. It piles on to the responsibilities of your finance person/team because they will have additional processes like different billing cycles, keeping track of changes to subscriptions, issuing correct and timely invoices and handling payments.
For SMBs this can be a big issue, especially if your team is stretched already.
Before you go any further. We’d wage that your brain might be scrambled; after all, this sounds like an immediate drain on the already-stretched resources you have.
And we agree. At first glance, it’s a huge amount to do.
The good news is this. You can get all the benefits that subscriptions have to bring WHILE not draining your SMB of the time and resources it already lacks.
It really can be done. And easily. Curious to find out how?
One Thing Can Do It All For You
You need a simple software solution that takes care of everything for you.
Here’s what the right automated subscription management can do for your SMB:
Operations optimized: It covers the end-to-end from marketing, to recommending the best subscription models and offerings, integrating with your supply chain system to ensure a reliable flow of products, and ensuring streamlined delivery where relevant. The silos between your sales, finance, customer service, and any other operations teams are gone for good. Information will free flow. No more chasing or errors.
Data crunched and customers put front and center: AI-driven advanced analytics make the most of the customer data sitting in your system. You'll learn your customers’ wants, needs, and behavior so that you can give them the experience they want. It can also segments your base so that you know who you’re targeting and how. This creates a personalized experience for each customer with no additional time required of you.
Sales sales sales: You and your workers won’t have to get frustrated over lost sales opportunities. Automated marketing campaigns (built on segments) will send personalized offerings, combinations, loyalty programs, etc. It will also spot areas that are ripe for improvement and track contracts and terms to recommend renewals, add-ons, and upgrades at the best time.
Revenue and finance sorted out: You need a system that can handle recurring billing and recognized revenue. Without it, subscriptions could break you and your team! Subscription management automates billing, payment reminders, collection, and reconciliation. And you’ll have the reports you need to get ready for audits, strategy, and decision-making.
Know how you’re performing: SMBs don’t have the time to monitor Key Performance Indicators. But with software you’ll get a consistent monitoring of how your products and business are doing. You’ll get reliable insight into what you need to change to get better results.
Security and compliance: A good solution pulls together financial, data and regulatory compliance. The last thing an SMB needs is to fall out compliance, vulnerable to hefty fines, and loss of customers and trust.
It’s a great list to start. And you end up with a new revenue stream, and more resources and time.
What Dynamics 365 Business Central + Bluefort Bring
Business Central is the perfect ERP system that automates so much for SMBs. It's also flexible and it grows with you.
Bluefort are experts in automated recurring revenue, which is essential for a successful subscription model. We can implement Business Central for you with all the customization you need to get the most out of everything the platform automates.
We're here to help you:
free your time and resources
automate subscription financial processes
cut costs and churn
build your customer base
bring in more revenue
expand your business
make your life a lot easier.
D365 Business Central and Bluefort are a comprehensive solution that delivers the best that subscriptions have to give to your SMB.
You get end-to-end subscription management, which pulls everything together for you and your workers.
That means you bring in all the benefits of bringing in the subscription model, with less work involved.
If you’re ready to bring subscriptions into your SMB, why not learn more about how it could help your unique SMB and circumstances?
