Last editedMar 20232 min read
If you run your business on a direct debit subscription model, then you can rely on a steady cash flow across the financial year. Rather than relying on one-off sales which can be cyclical or seasonal in nature, you can sell your product or service in return for a fixed monthly fee and enjoy certainty in terms of your income stream. For a long time, smaller businesses would struggle with taking recurring subscription payments from customers because of the complex nature of the banking systems. The good news is that working with a partner like GoCardless makes it much simpler to handle recurring subscription payments and adopt the subscription business model, up to and including the question of changing the price of an existing subscription.
Increasing subscriptions and recurring payments
There are different reasons why you might choose to increase the recurring subscription payments you take from your customers:
The price you pay for the goods or services you provide has risen, cutting into your profit margins
Your overall operating costs have risen due to factors such as an increase in energy costs or the price of raw materials
The nature of the service required by an individual customer has changed
An introductory offer period has ended. For instance, you may have offered a 50% reduction for the first six months in order to persuade someone to sign up to your online subscription payment system, and need to increase the subscription to the full standard charge now that the introductory period has ended.
Altering subscriptions and recurring payments
GoCardless is the perfect tool for collecting and altering subscriptions and recurring payments. One of the key benefits of working with GoCardless is that it integrates seamlessly with a wide range of subscription and CRM software. If you work with partners such as Chargebee, Salesforce and Xero, then you can take subscription payments in a manner which greatly reduces the number of chargebacks you have to deal with.
From your customers’ point of view, setting up a direct debit subscription is a simple and frictionless process. Each customer simply has to enter their payment details online using one out of a variety of methods:
a customisable payment page on your website
a secure link sent to the customer
integration with your existing checkout
Once a direct debit subscription has been set up, the payments are taken automatically on the agreed date, with a much lower failure rate than card payments.
The advantages of a subscription payment system include the ability to make accurate predictions of revenue incoming over a longer period, better inventory management and a stronger relationship with customers. The last of these is driven by the fact that a customer signing up to a subscription is entering into a long-term relationship with your business, rather than simply making a purchase and perhaps moving on to another business for the next purchase.
The good news is that working with GoCardless means that a subscription price increase is quick and simply to apply. With a few clicks you can pause a subscription and edit the details of the payments being taken. As well as increasing the amount being charged, you could implement a reduction or take a one-off payment, and all without your customer having to take any action whatsoever.
We can help
GoCardless is a global payments solution that helps you automate payment collection, cutting down on the amount of financial admin your team needs to deal with. Find out how GoCardless can help you with one-off or recurring payments.