The RallyMind Blog

6 Tips to Increase Cash Flow for SaaS Businesses

September 10, 2019

Tip 1: Keep costs down

It's important to keep an eye on the rising costs within the company (maybe ditch buying the entire office expensive coffee everyday). Keep overspending down to a minimum and track where the money is going.

Tip 2: Freemium Model

Often times, marketers will use the psychology of "free" to bring in new customers - when people see "free" they're more likely to purchase a product/service. This model begins with the "free + subscription" idea; consumers will get the product to try out until they find value in the product/service, then, they're likely to upgrade in order to receive the premium benefits.

Tip 3: Enterprise Companies

"Land a whale" means to land a contract/deal with a larger company who have a "whale sized budget". These companies are good for boosting business and increasing the cash flow, however it is relatively difficult to land a whale, so it's important that you don't solely depend landing whales.

Tip 4: Incentivize Annual Payments

In the long run, you want customers to purchase an annual contract/payment over a monthly subscription. However, customers need an incentive to pick the annual subscription over the monthly one, and often times a discount (normally between 10-20%) is enough to push them over to the annual subscriptions. Another option for this is to opt for multi-year subs for clients who have worked with you for a number of years.

Tip 5: Customer Retention

Customers are the main source of revenue in business. In order to retain the stream of revenue that comes in from clients purchasing your product/service, customers must be nurtured to ensure that they're getting the full value of the product/service that they purchased - a customer success manager is integral to this customer retention, as they're able to check-in with them on a constant basis to make sure that the connection is strong. By keeping track of them and checking in with them on a regular basis, they become a re-occuring revenue source for the business.

Tip 6: Upgrades and Upsells

Instead of trying to reel in new customers, you can increase the flow of cash into the business by marketing towards the current customers by emailing and texting upgrade offers and new products that they would use. Sending special offers for better service and creating new products and features for existing customers will increase the amount of cash that is coming into the company, which is much easier than convincing someone new to buy a product/service.