Subscriptions

Managing Recurring Revenue

A Subscription is a standing agreement to bill a customer repeatedly on a schedule (weekly, monthly, yearly) without re-creating a sales order every time. It's the engine behind membership fees, SaaS-style plans, maintenance contracts, or any product/service sold "for as long as the customer keeps it."

This is distinct from CRM's "Recurring Revenue" opportunity tracking, which forecasts future recurring deals in the pipeline before they're won — a Subscription record is the actual, active, post-sale contract that generates real invoices.

Core Concepts

The Subscription Lifecycle

Creating a Subscription

1. Go to Subscriptions > Subscriptions → Create (or auto-generated when a customer buys a subscription product through Sales).
2. Select the Customer and Template.
3. Add Subscription Lines – the product(s), quantity, and recurring price.
4. Set Start Date and confirm the Next Invoice Date looks right.
5. Set In Progress once the customer has agreed and it should start billing.

Automatic Recurring Invoicing

A scheduled action runs periodically and, for every subscription whose Next Invoice Date has arrived, generates the invoice (per the template's Invoicing Mode) and advances the next invoice date forward by one recurrence interval — you don't manually invoice each subscription every cycle.

Upgrades, Downgrades & Mid-Cycle Changes

Add, remove, or change the quantity of subscription lines at any time — the next invoice reflects the updated lines. For a fair mid-cycle change, some businesses prorate the current period manually; Quickenerp doesn't force a specific proration policy, so agree on one internally and apply it consistently.

Renewal (Fixed-Duration Subscriptions)

When a Fixed-duration subscription approaches its final cycle, mark it To Renew to flag it for a renewal conversation, then either extend the same record or close it and create a fresh subscription for the new term — whichever your business prefers for contract record-keeping.

Closing a Subscription

1. Open the subscription → Close.
2. Select a Close Reason (e.g. "Customer cancelled," "Switched plan," "Non-payment").
3. No further invoices are generated after closing.

Always record a real close reason — this is exactly what churn reporting (next article) depends on.

Understanding Recurring Revenue Health

Key Metrics

• MRR (Monthly Recurring Revenue) – total recurring value of all active subscriptions, normalised to a monthly figure.
• ARR (Annual Recurring Revenue) – MRR × 12; the headline number for subscription businesses.
• Churn Rate – subscriptions closed in a period ÷ active subscriptions at the start of the period.
• Net Revenue Retention – how existing customers' spend changes over time once upgrades/downgrades/churn are all netted together.

Grouping by Stage & Close Reason

Group the subscription list by Stage for a pipeline-style view of where every contract sits, or by Close Reason to see which cancellation reason is most common — the same discipline as CRM's Lost Reason analysis, applied to the post-sale side of the business.

Tags for Segmentation

Use Subscription Tags (plan tier, acquisition channel, industry) to segment MRR/churn reporting beyond the built-in fields — useful for answering "which plan tier churns the most" or "which acquisition channel produces the stickiest customers."

Best Practices

• Start new templates in Draft invoicing mode and graduate to full automation once trusted.
• Always capture a real Close Reason — a pile of "Other" makes churn analysis useless.
• Reconcile total invoiced subscription revenue against the Financial Reports course's Profit and Loss report monthly.
• Review subscriptions nearing the end of a fixed term well before the last cycle, not on the day it lapses.