Four Ways Cloud ERP Supports High-Growth SaaS and Subscription Companies
Software-as-a-Service (SaaS), Platform-as-a-Service (PaaS) and Infrastructure-as-a-Service (IaaS) have become popular delivery methods for organizations of all sizes that want to expand their capabilities without having to install, run and maintain their own servers and data centers.
Served up on a subscription basis, SaaS helps companies reduce their upfront investments and makes investment an operational expense (OPEX) versus a capital expense (CAPEX). These and other factors have pushed the SaaS market to new heights in recent years. However, there are challenges in managing these sorts of businesses, particularly with finance.
For example, managing recurring revenues requires some finesse and can’t be handled properly using basic financial software applications like QuickBooks and Excel spreadsheets which many SaaS companies rely on. While some companies have built their own databases or use Salesforce.com to compute and report on key metrics, these organizations still rely heavily on spreadsheets for reporting.
As a NetSuite Alliance Partner, AppWrap helps B2C and B2B subscription-based companies that have $5 million or more in annual revenues implement NetSuite in a way that meets their specific needs and addresses the complexities of their operational models. It also introduced the Recurring Revenue Reporting Systems (R3S) SuiteApp, a customizable SaaS metrics solution built on the NetSuite platform.
NetSuite recommends R3S as the must-have tool for subscription business
R3S by AppWrap extracts recurring revenue data from transactions in NetSuite and instantly translates those numbers into comprehensive subscription reports without exporting any data. This built-in NetSuite solution produces SaaS metrics based on the ARR data generated, in combination with other NetSuite data, to show details such as customer acquisition cost, lifetime customer value and the Rule of 40.
Four Key Wins for SaaS and Subscription Organizations
Here are four major benefits that high-growth SaaS and subscription companies can count on when they implement NetSuite and AppWrap’s R3S:
1.
Less manual work. With NetSuite and R3S, the finance department no longer has to manage Excel files, shuttle data across disconnected systems or worry that their reports won’t stand up to investor, private equity or venture capital scrutiny.
2.
Valuable time savings. The number of hours saved once NetSuite and R3S are implemented can be substantial for a SaaS company that manually manages its financial reporting. AppWrap estimates that these solutions save a typical organization anywhere from 30-40 hours per month. “Those are very expensive resources sitting and doing Excel work,” said Jay Swaminathan, Founder, CEO and Principal Consultant at AppWrap, LLC.
3.
Accelerated reporting capabilities. Investors want metrics to review and make decisions on, and companies must be able to produce timely, accurate reports. NetSuite and R3S greatly accelerate speed of reporting, with month-end finance tasks taking a few days at most versus several weeks to finish. Companies can reduce the risk associated with Excel spreadsheets, where other methodologies and approaches can easily deviate from the norm and produce incorrect results.
4.
Mind the financial reporting gaps. SaaS and other subscription-based organizations that can’t readily produce accurate key performance indicators (KPIs) can quickly fall out of favor with investors clamoring for metrics, analytics and reports. Excelling at designing and selling SaaS-based software or other products, subscription-based companies don’t always have the resources required to assess their key metrics and make better business decisions based on that data.
Swaminathan said now is a great time for SaaS and subscription-focused organizations to assess their current operational platforms and upgrade to a cloud ERP system that helps to run a successful enterprise. And when they no longer have to pull data from disparate applications—and then aggregate that information and calculate it on spreadsheets—SaaS companies can also reduce risk, enhance operational efficiency and operate more profitably.
Ready to upgrade your SaaS business?
AppWrap will guide you through the quickest and most efficient way to implement NetSuite during this critical transition. Show us what your current process and systems are, and our team will provide you with insights on how to set up your systems to scale with minimum disruption. Schedule your no-pressure consultation with us today.
