SAP Subscription Billing – Improved Capabilities for Use Cases
With the emergence of subscription services, industries have witnessed substantial growth in their revenue streams. The growing preference for customers to use third-party services have rendered the subscription business model a dominant one. It has become the ultimate choice to streamline the billing lifecycle and augment a strong customer relationship.
According to Gartner, popular research and advisory company, “70% of organizations have deployed or are considering deployment of subscription services.” The subscription services are expected to have a radical growth in the future where 75% of companies that sell directly to consumers will deliver subscription services by 2023.
What is SAP Subscription Billing?
SAP Subscription billing supports customers in their solution and subscription businesses by simplifying all the billing tasks. Starting from subscription product design, lifecycle management, to automated billing, it helps you quickly create and monetize user data.
It is built on multi-tenant SaaS micro services architecture – a constantly innovating and extensible public cloud with a guarantee of faster ROI. The main focuses of SAP Subscription Billing are on product modeling, subscription lifecycle management, and monetization of billing and non-billing data based on the price and rate plans.
Let us now see the use cases of SAP Subscription Billing
- Subscription Business
- High-volume subscription business
- Solution Business
1. Subscription Business
SAP Subscription Billing for subscription business delivers billing services based on the business models, whether B2B or B2C. It innovates the transformation into an Everything-as-a-Service provider by using multiple pricing elements. By design, subscription business stores and maintains the latest information.
- Managing the subscription lifecycle
- Rate planning for subscription products – one-time, recurring, or usage-based.
- Activating quick time-to-market and idea-to-cash
- Managing usage records for pay-per-use models.
- SAP Subscription Billing is the key billing and lifecycle management enabler for subscription-based business models to carry out Q2C and E2E processes.
- Enabling quick time-to-market and idea-to-cash for subscription-based business models
- Flexible master data – Add a new product, remove a product, and price plans.
- Cash renewal options and terms.
- Cancellation of product order at any point of time during the billing cycle.
- Money-back guarantee according to the subscription terms.
The subscription business’s ability to streamline the quote-to-cash process comes with the pre-delivered standard integration content with various built-in scenarios.
These integrations support the end-to-end lifecycle of the product lifecycle, subscription management, and other extended functionalities such as e-commerce.
- SAP S/4 HANA Solution Order
- SAP S/4 HANA Cloud for Contract Accounting and Invoicing
- SAP S/4 HANA Cloud for Sales Billing
- SAP S/4 HANA On-premises SD
- SAP Master Data Integration for business partners.
- SAP Business ByDesign
- SAP Commerce Cloud
- SAP CPQ
- SAP Entitlements Management
- SAP Digital Payments
2) High-Volume Subscription Business
High-volume subscription business typically takes over the B2C scenarios with a very large volume business.
- Managing high amounts of subscriptions and corresponding bills
- Managing high volume of usage records in pay-per-use scenarios.
- Capabilities to manage high volumes effectively.
- Integration with other cloud technologies like SAP S/4 HANA to enable high performance with the ability to carry out the entire Q2C end-to-end process.
- Monetization of subscription-based business models by managing usage-based services in an integrated O2C cycle for high-volume scenarios.
The improvements for integrations for High-Volume Subscription Businesses are,
- Integrating SAP S/4 HANA for contract accounting and invoicing – for provider contracts.
- Support revenue recognition based on Contract-Based Revenue Recognition (CBRR).
- Integration of bills into billable items in SAP CI and provider contract information.
- • Subscription Billing- Charges for a subscription item, whether one-time, usage-based, or recurring.
- • Billing forecast- On billable items and charge based on one-time or recurring.
3) Solution Business
Solution business innovates business model innovation with bundled product offers to give out a holistic solution to customers.
- Bundling of different product types.
- Tracking the progress of order items.
- Processing single invoice for the bundled offer.
- Supporting customers in their transformation journey to become a comprehensive solution provider.
- Integrating SAP Subscription Billing and SAP S/4 HANA to run the complete Order-to-Cash cycle.
- Realizing the overall end-to-end process through an end-to-end integration of individual solutions in SAP S/4 HANA Cloud including CPQ, Solution Order Management, Entitlements Management, Solution Billing Receivables Management, Analytics & Reporting.
- Overwriting default subscription terms.
- Allocation of subscription expiry on a follow-up in the middle of a billing cycle.
- Specification of pricing date for the follow-up subscription.
- Specifying a manual value for pricing parameters to retrieve default SAP Subscription Billing value.
- Selection of either manual or default values to apply to a pricing parameter.
Deliver an enhanced quote-to-cash experience to customers using the integrated cycle of Subscription Billing and individual solutions on SAP S/4 HANA cloud.