What is complex billing?
Complex Billing: Billing customers for multiple-line items priced differently or goods priced based on more than one factor.
Taxes, fees, discounts, shipping costs, and other things with different price structures can make billing more difficult.
A company that bills its customers for more than one type of product or service may use complex billing to describe how it sends its bills.
Because of this, you need a precise system to ensure that customers are billed correctly based on the pricing model(s) of the things they buy. Recurring fees or subscription-based services may also be part of this type of billing, which needs a unique way to keep track of users and bill them.
When you use complex billing, you must enter a lot of information several times for the bill to be correct.
To do this, you need complete billing solutions that make the process easier and make sure the information is correct. Businesses that sell goods and services at different prices may find it hard to keep their customers in the proper price range if they don’t have a system built for complex billing.
Synonyms
- Complex billing process
- Complex billing model
- Billing for complex pricing models
The need to handle complicated billing
Prices and business plans come in a lot of different forms these days. Modern pricing models, like tiered subscription plans and usage-based services, help companies make their products more competitive and increase their recurring income.
At the same time, buyers want customized goods and services, meaning billing needs to be innovative.
Because these pricing models are so complicated, B2B companies need billing systems that are just as complex and can handle all the different factors, data, and inputs needed to make accurate invoices.
Complex billing is a way to charge customers based on many things that are hard to figure out with the usual ways of billing and collecting payments.
Some examples of complicated payment systems are:
- SaaS and other subscription-based services
- Price based on levels, like cell phone plans
- Models based on usage, like utilities
- Hybrid models that use a mix of price strategies
When an online business offers a recurring service with different price points based on the number of customers who sign up, the length of their membership, the features that come with it, or the type of support provided, many use subscription-based services.
Tiered pricing models let you choose the amount of service you want at a price that fits your budget. They can be used for monthly services like internet or phone plans.
In usage-based models, customers are charged based on how much of a good or service they use, like water or power.
Hybrid models use multiple ways of setting prices to get the best customer and business results.
Why It’s Hard to Use Billing Software
In a complex billing setting, the software’s main job is to automate creating and managing customer information and invoices at the account level.
Billing systems that are highly complex store information about customers and make thorough reports about how they spend their money and what they do.
Complex billing systems can also keep track of payments, figure out taxes that need to be paid, and make personalized bills.
Some complicated billing software can also connect to other programs, like accounting software or enterprise resource planning (ERP) systems, to make tasks more accessible to automate and bring together financial information for billing and collecting payments.
Features of a Complex Billing Solution
A billing system that can handle complex pricing models can help streamline operations, cut costs, boost accuracy, and better control customer information.
A lot of the time, features like automatic billing and recurring payment plans are added to make paying bills more accessible for customers and faster for accounting teams.
Support for multiple currencies or payment choices, flexible discounts, the ability to customize invoices and statements, reconciliation reports, and the ability to connect data from one system to another are other things needed for complex billing transactions.
Flexible Catalog of Products
One of the best things about using a billing system for complicated pricing is that it lets you use a flexible product catalog to make quotes and invoices.
A product catalog that is updated in real-time can be used to make correct invoices for single-line items, bundles, and packages. This cuts down on mistakes in sales prices and bills.
Automatic Billing
Any billing system that can handle complex billing needs to have automated billing.
It’s easier for both customers and businesses when there are features like automatically creating invoices from existing records, integrating with third-party systems for real-time updates, templates that can be changed, and sending emails or texts to customers about late payments.
Repeat Billing
A complex billing system should also have features to set up recurring payment plans.
Businesses can charge customers regularly with recurring billing, so they don’t have to set up each monthly payment individually.
Some features let you set limits on how late you can charge customers and send reminders when their subscriptions are about to expire.
Multiple-Currency Billing
Due to the growth of global e-commerce and business relationships between countries, more and more modern billing systems can handle payments in more than one currency.
Businesses can send bills in different currencies depending on the area or region of the customer with multi-currency invoicing.
Reports on Reconciliation
There should be detailed reconciliation reports showing all activities in a way that makes it easy to keep accurate cash flow records and organize financial information.
Different ways to pay
There should be a lot of different ways to pay through the system, such as credit cards, PayPal, bank transfers, ACH payments, money orders, cash on delivery (COD), purchase orders (POs), and more.
How to Find Fraud
These billing systems have advanced analytics that looks through datasets for trends linked to fraudulent activities, like duplicate entries or wrong address information. This makes it easy to find invoices that were sent in without permission.
Complex billing systems can even let managers know when they see suspicious activity so they can look into it before processing payments or filling orders.
Data Integration: Finally, the payment system should be able to connect to other systems like CRM and CPQ to get data from multiple sources and learn more about how customers behave and spend money over time.
