Dear SaaStr: How Do Enterprise SaaS Companies Deal With Late Payments?
Yes, in the end, you have to be willing to switch off the platform. But do it gracefully, with respect. Do it the same exact way you’d want to be treated if you were a customer.
The key is to provide a series of notices, probably at least 5-6 in a managed cadence:
- 60 days before renewal
- 30 days before renewal
- 15 days before renewal
- URGENCY right before renewal
- RENEWAL MISSED — To avoid service interuption, please pay ASAP. because … we’re SHUTTING YOU OFF IN 14 DAYS right after missing renewal (notice #5)
- SECOND SERVICE INTERRUPTION NOTICE: 72 hours until service interruption.
In the end, you may have to switch it off.
But as you get bigger and better, your customer success team can get more and more involved as you pass stage 5. They’ll get the check for you if in the end, A/R doesn’t with a dedicated process like the above. Because Customer Success — they’re compensated on avoiding churn.
And if at all possible. provide some in-app notification of overdue accounts. That works well.
….
A while back, Marketo cut off our application at a critical time without telling us — or so we thought. It turned out, they sent some emails to the email address of someone that hasn’t worked at SaaStr in years. Was that our fault? Yeah, I guess so. But were we treated the way you’d want to be treated? Of course not. Do that.
A related post here:
What To Do When a Customer Doesn’t Pay? Let it Go and Move On.
(image from here)
The post Dear SaaStr: How Do Enterprise SaaS Companies Deal With Late Payments? appeared first on SaaStr.
via https://www.aiupnow.com
Jason Lemkin, Khareem Sudlow
