When investing in an ERP solution, companies must consider a multitude of benefits and features that will have a profound impact on how the company manages its daily processes. Businesses in varying industries have different considerations when it comes to choosing an ERP system that is best for them. Over the successive weeks this blog will discuss why NetSuite is right for companies involved in wholesale distribution, software, services, retail, manufacturing, general business and ecommerce. This will also include the features and benefits that pertain to enterprises in each of those areas.
Depending on the industry your business is in, you will have different needs that your ERP system must address. In our previous blog post we discussed these needs for software companies and how NetSuite satisfies all these requirements. In this post we will move on to detail some of the specific features in NetSuite that software companies will find useful.
Accounting and Finance Features:
Revenue Recognition: The complexity of revenue recognition for most software companies is daunting. Trying to keep track of evolving requirements and determine if they apply to your company is sometimes almost as complex as the regulations themselves. Unfortunately for most companies, dealing with these different regulations often results in offline spreadsheets or third-party packages that cause further issues.
NetSuite supports the latest AICPA, FASB and SEC regulations (including SAB 101, SAB 104, SOP 97-2, EITF 08-01, EITF 09-03 and SOP 81-1). NetSuite accommodates the requirements of EITF 08-01 and EITF 09-03 relating to Estimated Selling Price (ESP), including relative allocation based on ESP. NetSuite also accommodates the requirements of SOP 97-2 and 98-9 relating to Vendor Specific Objective Evidence (VSOE), including the Residual Method and a separate VSOE price for every item. Percent Complete Revenue Recognition allows companies to recognize revenue in conjunction with the completion of a project. NetSuite supports Sarbanes-Oxley compliance and enables you to manage GAAP revenues and billings separately—a critical operation for most software companies.
Renewals Management: Renewal revenue is a critical source of revenue for most software companies and managing and optimizing these revenue streams is critical to their long-term health and success. Yet many companies suffer revenue leakage and customer churn because they rely on cumbersome and inefficient manual processes to manage renewals and account for recurring revenue. The many spreadsheets and organizational handoffs involved introduce costly errors and delays, obscure visibility into the pipeline and rob companies of the opportunity to capitalize on the full potential of contract-based business. In many cases, software companies leave money on the table because they cannot respond quickly enough to expiring customer relationships.
NetSuite provides the critical end-to-end functionality that software companies require to manage their renewal business. NetSuite uses a single repository for customer management, facilitating the tracking and renewal of contracts, including subscription licenses as well as maintenance and support. Additionally, NetSuite allows you to automate renewals through a flexible and powerful process to track renewable assets and maximize revenue. Software companies can reduce costs through better billing efficiencies and gain real-time visibility into the installed base, pipeline and status of renewal revenue, upsells and returns.
Reduced Overhead: NetSuite’s integrated financial management has been proven to enable significant reduction in the size of finance departments in software companies. Greater productivity from integration, real-time tracking and reports, and auditing tools reduce the overhead that typically burdens software companies.
Software-Specific Marketing: NetSuite provides rich, software-specific reports on lead generation, and more importantly, lead conversion to revenue. Keyword tracking and website analytics provide visibility into specific search engine referrers and natural keyword metrics so that software marketers can intelligently leverage the effective ad-word marketing channel.
Software Commissions Management: With its forecasting technology, NetSuite allows for complex, multi-tiered commission schemes around billings or other revenue measures—such as first-year deal value—as they relate to multiple quotas. In addition, support for mid-year accelerations and other sales kickers allow a software company to further incent the sales team.
Software Sales Forecasting: NetSuite includes the capability to manage multiple quotas and corresponding forecasts and commission plans. For example, for companies delivering Software as a Service, it is useful to give sales people one quota for gross billings and a separate quota that measures the first-year value of deals.
Renewals and Maintenance Sales Management: Renewals and maintenance sales management are built in for improved revenue management for the company and seamless service for customers. Start and end dates at the customer level and the sales order level trigger automatic reminders for contract renewal, while tailored billing schedules handle maintenance invoicing. Additional functionality provides for the automatic creation of renewals and renewal orders based on a pre-defined window.
Contact Our NetSuite Team
Are you interested in learning more about the features in our NetSuite solution? Contact SWK’s NetSuite professionals to learn how these features can benefit you. For additional information please contact us at 877-979-5462, or click here to contact us.
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