Ask any successful business owners, and one of their critical tips in growing, expanding, and maintaining a well-established business will include billing and revenue management. The systems and techniques used in the current billing management models have come after many years of research and trials.
The revenue management models not only help in tackling non-payment but also gives the company a clear view of its progress. What is billing and revenue management? Why do companies need it?
In this article, I will be discussing all there is about billing and revenue management, what it is, why it is done, how it is done, and much more.
What Is Billing And Revenue Management?
Revenue and billing management is a system linked with all the aspects of generating revenue for the company, from charging, billing, and managing the total revenue. This term is mostly used in the telecommunications industry. However, it does have an equally important use in other different industries such as Healthcare, Media and Entertainment, Financial Services, Energy and Utility Services, and more.
Billing and revenue management serves many important advantages to several industries. With this system, a company or a brand can charge its customers for their service usage and the subscriptions that they bought. It also allows the company to manage its customer’s balances by rating their usage and updating their balances in real-time.
Apart from that, the billing and revenue management system allows the company to compile the invoices for each and every client to create a customized bill. The payment for this customized bill can be requested through credit cards or by emailing the client’s invoice.
Plus, all the customers’ accounts are stored in the database of the billing management system, which will allow the company to manage their customer’s accounts by activating, deactivating, creating, closing, and managing. The report generated from the database allows the company to have an idea about the client’s choice of purchase so that they can offer more relevant products.
How Is The Billing And Revenue Management System Executed?
The execution of the billing management system requires the company to change its existing processes and implement new processes and architecture to its systems. Here is how companies implement and execute billing & revenue management systems.
This function regulates the amount a customer will be charged on each of his purchases. This process is initiated when a customer performs a function that triggers the event. For example, that triggering event could be anything, such as a phone call, data consumption, and more. However, this triggering event is allowed to proceed further only after the system has checked the customer’s remaining balance.
It is on this basis that the further processing of the event is allowed or not. For example, a call can be blocked by the system if it detects that the customer has surpassed the balance on one’s prepaid mobile phone plan. The next step in the charging function is that the system calculates the event and the customer’s price plan. It then decides how much it needs to charge the customer and adds the amount to their invoice.
Billing And Payments
Billing is the process by which the customer’s balance is calculated, and a total amount is generated. This amount is sent to the customer as a payment request in the form of either a printed or electronic invoice. It can also be sent directly to the customer’s credit card processor.
This billing cycle is conducted usually towards the end of the month or when the balance of the customer reaches a certain set limit. All these billing and payment methods are carried out on the terms and policies that a company sets at the very start of its system configuration. For example, what day of the month to bill the customers, how often to bill the customers, billing policies, payment setup, and collection setup are all predefined terms by the company.
Balance And Customer Management
Every customer in the set billing and revenue management system has their record saved in the database. The information stored includes the customer’s name, account information, service status, account status, balance, the payment that he owes, his form of payment method, and more.
The billing management system divides the customer’s assets into several balance groups. It will have a balance in any kind of currency, such as euros or dollars, and even in a non-currency, such as call minutes and data usage.
This balance sheet can be adjusted by the concerned company. For example, if a service is not available for a time, the remaining balance on the sheet will be changed and adjusted. However, there is always a second option of returning or refunding the money directly to the client.
Advantages Of The Billing And Revenue Management System
Such a management system has been adopted by many companies, brands, and franchises all around the world. Every day, there is a strive to make this system better than before. All this concludes that this system must serve several advantages to the companies that use it.
- The first advantage is that with the help of this system, companies can improve their customer’s experience and also have an insight into the customers’ demands. The insights obtained from the accounts of the customers may be shared with customer support, pricing, and sales team, which will further enhance the customers’ experience. This way, companies can retain their customers for a more extended period by managing the churn rate of the service.
- The billing and revenue management system is a very flexible kind of model that allows and supports several monetization models. This allows the company to offer plenty of services, which will help them to differentiate from other companies and offer value to its customers.
As these systems are automated, they can perform multiple complex monetization models simultaneously without making any errors. This, in turn, lowers the operating cost for the company.
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