4 Steps to Automate Recurring Invoices in NetSuite

What you’ll learn


  • What is a billing schedule?
  • Benefits of billing schedules
  • How to use NetSuite to create billing schedules
  • Challenges in NetSuite and how AR apps help overcome them

Introduction

Most business deals are no longer one-time transactions. Annual sales contracts are often broken into monthly or quarterly payments. This is especially the case for IT services, software, insurance, telecom & utilities, and rental industries.

But as a supplier or service provider, billing clients according to different schedules can be challenging. How do you identify which clients need to be sent bills each month and what’s the invoice amount? If you’re doing it manually there’s a high chance that you might either miss sending clients invoices on time or might make errors in the bill amounts.

Invoice automation solutions can help you prepare and send error-free recurring bills to clients as a matter of routine. This can also save your finance team much time and effort. Standard invoice automation features are available in enterprise resource planning (ERP) solutions like NetSuite and advanced functionalities can be availed using accounts receivable (AR) software such as RadiusOne.

In this article, we look at the steps to create a billing schedule in NetSuite. We will also talk briefly about how out-of-the-box solutions such as RadiusOne help ramp up the AR processes. But before we look at the steps to create a billing schedule, here’s a quick definition of billing schedules and a list of benefits you stand to gain by automating recurring invoices.

What is a billing schedule?

A billing schedule refers to billing a sale over a range of time or a contract term. For example, you may want to bill monthly for a one-year membership or bill quarterly for a five-year service contract. Billing schedules manage the billing process by automatically tracking when to invoice customers and how much to bill.

Benefits of automating recurring invoices

Key benefits of creating billing schedules to automate recurring billing are:

  • Reduce missed or late payments: On-time and accurate invoices help reduce disputes and prompt customers to pay on time. Automated billing ensures timely delivery of invoices and reduces late payments by customers.
  • Improve customer experience: Accurate invoices in uniform formats help customers quickly check their bills and make payments. In addition, with automated billing options, you can extend subscription offers to customers without worrying about any added processing costs to your business.
  • Reduce invoice errors: Automated invoices ensure error-free billing even for a large number of customers. This allows you to scale your business and offer superior customer experiences without putting pressure on your resources.
  • Reduce administrative costs: Automated billing schedules help you reduce full-time equivalent (FTE) costs and other operational expenses involved in preparing invoices. Research points out that automated invoicing can reduce processing costs by 75% – 85%.

How to set up a billing schedule in NetSuite

NetSuite ERP offers features to help you set up billing schedules to enable auto-invoicing.

Sales orders are the basis on which billing schedules are created in NetSuite. Depending upon the payment frequency you choose, the dollar figure in the sales order is divided to be paid over the selected time frame.

Let’s walk through each of the steps to create a billing schedule in NetSuite.

1. To check the recurring billing schedule frequencies available in NetSuite, go to Lists > Accounting > Billing schedules.

To check the recurring billing schedule frequencies available in NetSuite

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The billing schedules pre-defined in NetSuite are:

  • Monthly – 12 months
  • Quarterly
  • Twice a year
  • Upfront

2. To create a new billing schedule other than the standard frequencies given in NetSuite, click ‘new’ under ‘billing schedule.’ Fill in the other fields such as the initial amount to be paid in the first invoice and the payment terms for the first invoice. Define the invoicing frequency as well as the count of invoices to be sent.

To create a new billing schedule other than the standard frequencies

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You can apply a billing schedule to the entire order or have different billing frequencies for individual line items.

3. Go to Transactions > Sales Orders and choose the sales order on which you want to apply a billing schedule.

3.1 To apply the same billing schedule to the entire sales order, click on the ‘billing’ tab in the sales order and check under the header ‘billing information’. In the ‘billing schedule’ field, select the desired payment frequency. You may also choose to define the payment method to be used such as credit cards or checks.

To apply the same billing schedule to the entire sales order

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3.2 To set different billing orders for the line items, go to the ‘items’ tab and change the value under the ‘billing schedule’ field in each line item. This lets you schedule bills for the items differently.

To set different billing orders for the line items

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4. Once you’ve saved the billing schedule, you can click on the ‘schedule’ button under the ‘billing’ tab. This provides you a quick overview of all future billing dates and the respective amounts.

quick overview of all future billing dates and the respective amounts

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Click on the button ‘next bill’ to view the bill for the next pending scheduled invoice.

How to create a billing schedule report in NetSuite?

You have to use the reporting function to get a complete view of all your billing schedules in NetSuite. Go to Reports > Forecast > Forecast by Status Summary. On the window that appears, click the ‘customize’ button and add the additional fields that you need by choosing from the option available under the ‘forecast’ button on the left-hand side.

Some fields that you could add to the report are the document number (or sales order number), customer name, the bill amount (or forecast amount), and the billing schedule. You could also remove the fields that you don’t want from the report. Save this report. You can view the billing schedule report for any date range.

How to create a billing schedule report in NetSuite?

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The challenges of automating recurring billing in NetSuite

While NetSuite’s billing schedule functionality helps you seamlessly send periodic invoices to customers, you might face some challenges in complex situations. Some of the challenges include:

  • Limited support for automated renewals: The billing schedule feature doesn’t allow for automated renewals of a contract. For example, if a client decides to renew a contract once the billing schedule has finished, you’ll need to create a new billing schedule and will not be able to continue or duplicate it.
  • Inability to automatically modify a billing schedule: You can’t modify your billing schedule once created. In cases where the contract changes halfway, modifications like adding a new product cannot be done automatically and need to be processed manually.
  • No billing schedule dashboards: There is no standard format to view all billing schedules. You have to use the reports features to get a quick overview of all your recurring bill schedules.

Use SuiteApps to overcome NetSuite billing schedule challenges

Many of the gaps in NetSuite’s AR features can be plugged easily using out-of-the-box integrations. NetSuite’s SuiteApp marketplace features hundreds of software solutions that help enhance the ERP solution.

RadiusOne is a popular SuiteApp that supports AR automation. RadiusOne offers modules for invoicing & collections, cash reconciliation, and credit risk management. Its eInvoicing feature helps you deliver invoices via emails and to clients’ accounts payable software. You can also embed payment links to the invoices to prompt customers to pay faster.

To learn more about RadiusOne and other offerings from HighRadius, schedule a call with one of our representatives. Book a demo now!

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HighRadius Electronic Invoice Presentment and Payment (EIPP) Software provides tools that automate and speed up invoice communication and facilitate a faster collection of payments, enabling a closer and more convenient relationship with customers. It automates the invoice transmission and payment collection process providing a configurable solution that supports multiple invoice formats and different modes of transmission (fax, email, portal, etc.) depending on the targeted customer, its integration with ERP systems and a rich search capability enables efficient storage and retrieval of past invoices, backup attachments to minimize disputes and short pays. Apart from that it also has some key features that you would not want to miss out: level-III interchange and surcharge; self-service customer portal; invoicing across email, customer portals, post, and fax; advanced deduction management; and lightning e-payments. The result is faster invoicing and payment collection, better customer service, and improved profitability and cash flow.