How do enterprise SaaS companies deal with late payments?
Yes, in the end, you have to be willing to switch off the platform.
They 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.