For your business to scale successfully you must have a robust and reliable payment infrastructure in place.
Failing to do so could see costs quickly rise, processes slow down and your competitiveness compromised.
Being more cloud-native
To meet the expectations of a demanding client base, companies should aspire to be more like a cloud-native.
Cloud natives businesses take advantage of cloud technology to be agile with their approach to deploying code, enabling frequent and rapid product changes. Meaning they can evolve and improve their product offering regularly. Customers expect the technology they use to have zero downtime and to be able to solve performance problems immediately. Just a few minutes of downtime can result in users switching to a competitor.
Cloud-native systems are designed to embrace rapid change, large-scale projects and be resilient. This is achieved by partnering with third-party vendors to integrate new features rather than relying on homegrown or in-house solutions. They embrace automation and portability across different environments so that software changes and new features can be rolled out on a regular basis.
Well-known cloud natives like Netflix, Uber, and WeChat, have thousands of services in production and deploy up to 1,000 times a day. This architectural style gives them the flexibility to instantly update small areas of live applications and scale them individually as required.
But you don’t have to be a massive enterprise company to benefit from a cloud-native approach.
Be agile and fast-to-market
Cloud natives are agile. Allowing them to adapt their systems to quickly meet business needs.
Unlike homegrown systems, a cloud-native approach gives businesses the capacity to cope with growing volumes of transactions, be malleable to include customers' preferred payment methods and accommodate new currencies as they launch into new international markets.
Agile project management is often used by cloud natives to make frequent and iterative changes so that features, products and services can be updated independently of one another and deployed swiftly.
In order to remain resilient in an uncertain and evolving economy, businesses need to be able to adapt to changes in the market and in customer demand.
Every customer is different, and no one payment method fits every customer's needs. When scaling your payments infrastructure, consider increasing your payment coverage by offering the right mix of payment methods to reach the greatest volume of customers and improve conversion.
YouGov Research, commissioned by GoCardless, found that payment methods requiring registration before purchase, such as Paypal or credit cards, have lower up-take than those based on banking rails, like bank debit.
Increasing the number of currencies you offer alongside different payment types can also improve conversion and your business’ resilience. Zuora found that businesses accepting five or more currencies grow 8% faster than those who only accept one.
Entering new international markets is particularly challenging and time-consuming. Businesses need to navigate and form partnerships with banks in new territories and integrate payment solutions. Cost can quickly add up when dealing with multiple currencies as FX rates are not always transparent enough to detail how much you will pay.
Alternatively, businesses can work with a global payments provider, like GoCardless, using global account-to-account networks to collect international payments easily and in your preferred currency. Applying this strategy will allow businesses to expand to new markets easily and quickly.
Consideration should be taken when prioritising the deployment of new features and products over design. You should think about the longevity and maintenance of your payment infrastructure.
Will changes be easy to implement down the line? Or will introducing a new solution provide gains in the short term at an expense in the long term? Technical debt needs to be thought about carefully when scaling your payments infrastructure.
Focusing on an agile approach to payments and preventing technical debt in payments infrastructure allows your business to get payment solutions to market quickly and meet the needs of your consumers, providing a seamless experience.
Utilising partners is cost-effective, freeing up the time of product managers and web engineers. Additionally, using partners from the ecosystem removes uncertainty and unpredictable costs from building solutions yourself.
Utilising the likes of GoCardless (for account-to-account payments), Zuora (to bill and collect subscription payments), and Salesforce (to manage customer journeys from lead through to being paid) allows businesses to benefit from specialist expertise and dedicated research and development.
Payments technology is fast-moving, so keeping up with the latest solutions can be daunting. As a best practice, you should seek out partners who have tight product integrations to enable data to seamlessly flow between different systems and business functions. This automation saves time and removes the risk of human error from manual data inputting.
Using the payments partner ecosystem also means online you don’t have to plan for additional costs and resources associated with improving, maintaining or fixing outsourced features in the future.
This saves you time and resources as you don’t have to hire and manage additional specialist staff to create new features. Instead, team members can focus on high-value work. This also transpires to day-to-day and operational finance team members.
Research from Forrester shows that 86% of businesses have 20 full-time employees to handle recurring payments. Introducing automation with a payment partner will empower you to save on admin time.
Be a master of payments
Mastering payments by leveraging the expertise of partners generate operational efficiencies, alongside empowering businesses to be agile and keep costs down.
Collect cash faster, improve cash flow, and reduce failed payments.
Cash collection is particularly relevant for scaling companies as a delay or failure to collect payments can present working capital issues, such as finding funds in place to pay suppliers or restricting the ability of your business to invest in growth.
For example, businesses using GoCardless see an average payment timing of just 3.6 days. Meanwhile, the average Days Sales Outstanding (DSO), identified by Forrester, is 20-30 days for the majority of businesses.
The Global Payment Timings Index 2021
Download the full report for all the important insights, as well as recommendations on how businesses can improve cash flow and payment timings.
Payments failure is another common issue for high-growth companies, with mid-market businesses losing around $296,000 on average annually and their enterprise peers losing $1.2m from this issue. Integrating with a specialist payments partner to optimise payment methods and retry payments can significantly reduce payment failures, with retries reducing them by around a third (3.5% to 2.4%).
Remain competitive in a fast-paced market
To scale payments infrastructure, you need to apply a multi-faceted approach based on an aspiration to be a cloud native. This will enable you to make changes quickly, incorporate features relevant to new markets and maximise payment coverage.
Partnering with best-in-breed solutions will allow businesses to deploy changes quickly and be lean by keeping overheads and development costs down. To be sustainable and remain competitive you should look to the partner ecosystem to further drive automation, create efficiencies and improve cash flow.