Billing Management

Stripe launches a new billing tool to tap demand from online businesses

Excerpts from the article by Matthew Lynley on TechCrunch

Stripe launches a new billing tool to tap demand from online businesses

As more and more spending moves online — whether that’s shopping or subscribing to services like Netflix and Spotify — there’s increasing demand for tools that allow those companies, especially smaller ones, to start getting paid.

Stripe  has made its name by providing developers with a simpler way to start charging customers and handling transactions, but today they hope to take another step by launching a billing product for online businesses. That’ll allow them to handle subscription recurring revenue, as well as invoicing, within the Stripe platform and get everything all in the same place. The goal was to replace a previously hand-built setup, whether using analog methods for invoicing or painstakingly putting together a set of subscription tools, and make that experience as seamless as charging for products on Stripe.

“These large enterprise companies have the resources to build internal recurring billing in house,” Tara Seshan, PM on the billing product, said. “Even then they would tell us what challenge it would be. What we did was took a step back and think about, how should this work, how can we make billing tools that are only available to enterprises be available to everyone. That meant something really flexible and really easy to implement. If you’re [running a small operation], you should have the same subscription tools as Spotify. What we have here is a set of building blocks so you get the speed and flexibility you need.”

Indeed, a lot of the Internet has slowly but surely shifted to a subscription model. There’s even a good chance that even the phone you have in your pocket is paid for in an annual subscription to amortize the big ticket price of that product over the course of several months. Larger companies have had these tools in place, but it’s a traditional very startup-y problem to just not have the resources to build them even by cobbling together online payments tools in order to get these running. Startups often have a long list of priorities, and they need to start generating revenue immediately if they want to continue growing.

This launch is, in part, a response to customers demanding a billing product that gets all these invoices and subscription expenses into a single spot. Stripe at its heart is an enterprise company, which means it has to keep close tabs on the needs of its customers while still balancing the needs to continue creating new products that small businesses didn’t realize would actually solve those problems in an elegant way. That’s especially true when it comes to Internet-oriented businesses, which are often changing their business models over time, Seshan said.

“Unlike something like Instagram or Facebook, where you’re doing analytics A/B testing voodoo to figure out what you should build, with Stripe, our businesses know what they want,” Seshan said. “They have clear requests, so we’re much more inclined to listen to our users as opposed to sitting in an ivory tower coming up with a strategy. As they look to add new products, that applies to the startup selling fast and iterating to the large tech companies about to launch a new subscription line or about to add a “for work” side of their product. What we saw often was that billing was the limiting factor to getting a product to market.”

In addition to all this, Stripe looks to apply the machine learning tools it’s created for things like fraud prevention into a new area of expertise. One example of this is figuring out when to intelligently retry a recurring billing charge, which may fail for any number of reasons. Stripe tries to get around problems like lost credit cards or anything along those lines to try to keep the experience as seamless as possible. Seshan said Stripe businesses that implement billing see a 10% increase in revenue — which, for flipping a switch, is pretty substantial.

As companies get bigger and bigger, they will also likely graduate beyond just a simple subscription. An enterprise software company, for example, will probably have to start targeting larger customers that have a salesforce and a different approach for implementing new technology. That means getting invoice-level revenue, which has different implementation requirements than just normal subscription billing. In that case, it’s not like the CIO of a Fortune 100 company can just put a credit card number into a billing service, as those require more robust research and a partnership in place.

While this is a tool that’s a natural fit for something like Stripe, it’s certainly one that’s created a substantial business opportunity. Last month, Zuora — an enterprise subscription services company — filed to go public amid a fresh wave of enterprise IPOs that included Dropbox and Zscaler (and also, to a certain extent, Salesforce’s big acquisition of Mulesoft). Zuora’s subscription services revenue continues to grow, showing that Stripe will certainly have competition here, but also that there’s a large market opportunity.

Read the full article on TechCrunch

How do I setup the Zuora Avalara integration?

Overview

Avalara is software for automated tax compliance. Whether you are selling online, starting a new business, or need help filing internationally Avalara can help with your tax needs. Customer who have more advanced or automated tax needs, generally choose to integrate Zuora and Avalara.

Below are the high-level steps to configure Zuora to work with Avalara.

Solution

Submit a ticket to Zuora Support in order to gain access to this feature (currently in Limited Availability).
 
1. Set up Connections to Avalara: Add Avalara as a tax engine in your Zuora tenant and set up the connection.
 
2. Configure Tax Codes in Zuora Billing: Create tax codes in Zuora and associate them with your tax codes in Avalara.
 
3. Associate Avalara Tax Codes with Product Rate Plan Charges: set the Taxable flag on the charge in order to display the Tax Codes. Choose the applicable Tax Code to use for that product
Note** this only needs to be done in the Product Catalog; a mass-amendment of subscriptions is not required.

4. Configure your Tenant Profile & Permissions: set origin address in Zuora and verify this address for compatibility in Avalara. Add Company Codes and additional origin addresses. Disable the Cancel Posted Invoice permission.

Note** all addresses require a Country; for US and Canada a State is required

5. Create Tax Exemptions: specify whether a customer account is tax exempt or not tax exempt
 
After completing testing in Sandbox, enable and test in Production.

How do I use Zuora with my existing website?

Overview

There are a few options for setting up Zuora to work with your existing website. You can incorporate Hosted Payment Pages directly within your site or application, use the SOAP API (for detailed, full-blown applications), use the REST API (for rapid development suitable for the most common web storefront operations), or use an out-of-the-box platform like PeakPortal to facilitate commerce.

Solution

Option 1: Zuora's APIs allow you to handcraft a web application that directly accesses our billing, payment, and subscription management services. The Z-Commerce API gives you access to Z-Billing, Z-Payments, and Z-Force applications via an open API. This option is the most time intensive and requires a broad understanding of Zuora.

Option 2: The second option is for you to use Zuora's hosted payment pages, which is built entirely with their SOAP API on the Z-Commerce Platform. A hosted payment page is a pre-built Credit Card or ACH form that you will need to integrate into the overall purchasing flow and requires moderate development work. 

Option 3: PeakPortal has developed an out-of-the-box application that easily connects to Zuora and supports over 150 subscription billing use cases. Upon a short implementation, they can customize the portal to look similar to your website to ensure your customers are never confused about the environment they are in. It is usually ready to deploy within 24 hours.

Learn more about PeakPortal and request a demo

Zuora NetSuite Integration - An Overview

Overview

The Zuora NetSuite Integration (aka Connector) is an optional solution that leverages the core capabilities of both the Zuora and NetSuite applications. Zuora manages complex subscriptions and NetSuite is a hosted General Ledger (GL) System.

Features

Zuora NetSuite Connector combines Zuora's subscription billing capabilities with NetSuite's ERP/Financials solution with bi-directional integration across every core application module to seamlessly combine the two applications.

This solution is a pre-defined, out-of-the-box integration that synchronizes transactions between the two applications. Zuora provides NetSuite Connector customers with an integration console in the Zuora Billing user interface which is used to set up the integration, control and monitor the synchronization of data, and view any error or success logs from the synchronization.

Integrating Zuora with NetSuite allows you to use Zuora's applications to:

  • Manage complex pricing and packaging models
  • Align charges with existing subscriptions
  • Consolidate billing
  • Streamline renewal patterns

Advanced Pricing Configuration

Configure any type of subscription pricing, packages and bundles (including one-time, recurring, usage and metering charges, volume tier pricing, and overage pricing) to link Zuora's Product Catalog and NetSuite's Item. For example, simple or complex subscription pricing can be configured in Zuora, such as a cellular phone plan or a data plan with usage, and synchronized to NetSuite's product catalog (e.g. items in the same hierarchical structure).

Customer Account Mirroring

Synchronize Customer Accounts, Billing Accounts, and any customer account hierarchies to provide a single view of all customers whether the data is in Zuora or NetSuite. For example, an address change in Zuora is synchronized with the corresponding account address in NetSuite (and synchronized from NetSuite to Zuora).

Bi-Directional Payment Operations

Manage the Invoice to Cash process in either Zuora or NetSuite with the two-way integration of Zuora Payment Operations with NetSuite's Accounts Receivable module. For example, a customer is issued a refund in Zuora when a subscription is cancelled and the refund is applied to the appropriate payment in NetSuite.

Revenue Recognition Integration

Manage revenue recognition by mapping Zuora's subscription details, including revenue recognition codes, trigger conditions, revenue start dates and revenue end dates to NetSuite's revenue recognition templates and Advanced Revenue Management Module.

Subscription Metrics

Drive key business decisions by using Zuora's subscription metrics, such as Contracted Monthly Recurring Revenue, Total Contract Value, Renewal Rate and Churn.

NetSuite customers can leverage NetSuite's cloud ERP/Financials solution in mixed cloud application environments, including using the Zuora CPQ solution which seamlessly connects Salesforce CRM and Zuora's subscription commerce platform.

Deciding to Use NetSuite Connector

Use NetSuite Connector to solve the following business problems:

  • You have are using NetSuite for one line of your business, but you want to leverage Zuora for subscriptions
  • You have customized NetSuite for subscriptions, but you have reached the limit of the NetSuite customization
  • You are using QuickBooks and want to upgrade your accounting system.
  • You want to have all transactions in your general ledger for a full reporting view in NetSuite.
  • You want NetSuite to handle your revenue recognition.

The New Zuora Orders Feature

We've received quite a few questions about the new Zuora Orders feature over the past several months. In summary, Zuora has evolved with their customers and the orders feature is an extension that allows greater system flexibility and supports more complex use cases than standard subscriptions feature. In other words, it allows Zuora a means to build out more functions and features that support complex business cases.

This article describes the objects used to support Orders. The objects provide essential information needed to create and maintain orders in Zuora.

The following diagram summarizes the Orders objects and their relationships. For the summary of all Zuora key objects, refer to Zuora Business Object Model.

Orders

Represents an agreement between a merchant and a customer, which creates or changes one or more Subscriptions. An Order is owned by a single Billing Account.

Corresponding data source: Order

Order Actions

Order actions represent the actions that can be performed on subscriptions, such as creating subscriptions and making changes to subscriptions.

An order can contain multiple order actions, acting against one or more subscriptions.

The following types of order actions are supported:

  • Create Subscription 
  • Terms And Conditions
  • Renewal
  • Cancellation
  • Owner Transfer
  • Add Product
  • Update Product
  • Remove Product

The following types of order actions are not currently supported:

  • Suspend a subscription
  • Resume a subscription
  • Update a subscription to change the subscription term end date before the renewal term start date

Order actions operate at the subscription level or at the rate plan level.

One rate plan level order action affects one rate plan. Rate plan level order action types include New Product, Remove Product, and Update Product.

One subscription level order action affects one or more rate plans. Subscription level order action types include Renewal, Cancellation, Terms and Conditions.

Corresponding data source: Order Action

Order MRR

Indicates how a given Order Action has changed discounted MRR for each charge. Metrics are tied to each Order Action, which are then linked to Orders.

Corresponding data source: Order Mrr

Order TCB

Indicates how a given Order Action has changed Total Contacted Billing (TCB) for each charge. Metrics are tied to each Order Action, which are then linked to Orders.

Corresponding data source: Order Tcb

Order TCV

Indicates how a given Order Action has changed Total Contact Value (TCV) for each charge. Metrics are tied to each Order Action, which are then linked to Orders.

Corresponding data source: Order Tcv

Order Quantity

Indicates how a given Order Action has changed quantity for each charge.Metrics are tied to each Order Action, which are then linked to Orders.

Corresponding data source: Order Quantity