Revenue Management Software: Features, Integrations, Success Factors, Financial Outcomes

evenue Management Software - ScienceSoft

Having 14-year experience in building financial software and practical knowledge of 30+ industries, ScienceSoft offers software development services to help companies implement reliable revenue management solutions.

Revenue Management Software: the Essence

Revenue management software enables real-time revenue tracking, automated revenue recognition according to the up-to-date accounting standards (ASC 606, IFRS 15, etc.), comprehensive revenue analysis and forecasting.

Revenue management software can support production, subscription, licensing, fee-for-service, markup, commission, advertising, and other revenue models. The solution is especially helpful for companies with high-volume and complex revenue transactions, multiple business entities, subscription or licensing revenue models.

A revenue management system should integrate with order management software, a contract management solution, a billing system, general ledger software, etc.

When integrated with dynamic pricing software, revenue management software can cover the functionality of yield management software to meet the needs of businesses operating under a dynamic pricing strategy in hospitality, public transportation, telecoms, advertising industries.

The implementation of custom revenue management software takes 6 – 10 months. Building the revenue management solution requires $140,000 - $400,000, depending on the solution complexity. Custom revenue management software of average complexity may bring 95%+ annual ROI.

Revenue Management Software: Key Features

Revenue tracking

  • Real-time revenue calculation.
  • Revenue tracking:
    • By type (accrued or deferred).
    • By period (monthly, yearly, multi-year, etc.).
    • By location (domestic or foreign).
    • By the company subsidiary or branch.
    • By customer/customer segment.
    • By product/product segment, etc.
  • Customizable revenue schedules to track the expected revenue recognition dates.
  • Automated currency conversions to track multi-currency revenue transactions.
  • Tracking source documents (contracts, invoices, etc.) attached to revenue records.

Contract revenue allocation

  • Calculating total expected contract revenue for each customer contract based on the obligations under a contract and their prices.
  • Estimating standalone selling prices (SSP) of separate products or services under multi-element arrangements.
  • Automated allocation of a transaction price to the separate performance obligations based on their relative SSP.
  • Automated re-allocation of a transaction price upon the updates in customer contracts.

Revenue recognition

  • User-defined revenue recognition.
  • Support of diverse revenue recognition methods:
    • Sales basis method.
    • Completed contract method.
    • Percentage-of-completion method.
    • Cost recovery method.
    • Installment method.
    • Deposit method, and more.
  • Recurring and non-recurring revenue recognition.
  • Point in time and over time revenue recognition.
  • Configurable event-based revenue recognition triggers (product shipment, service activation or completion, achieving a specific project contract milestone, etc.).
  • Automated coding and posting of revenue transactions to the relevant GL accounts (e.g., accrued revenue under assets, deferred revenue under liabilities).
  • Simultaneously recording revenue transactions in multiple books with various functional currencies and revenue recognition standards (ASC 606/IFRS 15, local GAAP, non-GAAP, etc.).
  • Automated revenue reconciliation.

Analytics and forecasting

  • Drill-down analytical dashboards on:
    • Total revenue (by period, region, customer contract, etc.)
    • Revenue growth (daily, monthly, yearly).
    • Revenue drivers (specific locations, customer or product segments).
    • (for subscription business) New and expansion MRR, ARR, CLV, churn rate, and more.
  • Trend-based revenue forecasting (by location, product, customer segment, business entity, etc.).
  • Real-time forecast adjustment based on the newly appearing data on revenue transactions.
  • Scenario modeling based on user-defined parameters to estimate revenue under various pricing strategies, revenue recognition policies, changes in customer demand, etc.

Reporting and compliance

  • Scheduled and ad-hoc revenue reports.
  • Customizable report templates.
  • Consolidated revenue reporting across multiple business branches and subsidiaries.
  • Compliance with ASC 606, IFRS 15, SOX, SOC 1 and SOC 2, local and industry-specific regulations.

Improve Revenue Management with Powerful Software!

ScienceSoft’s team is ready to plan, build, and support an effective revenue management solution to speed up revenue consolidation, enhance the accuracy of revenue accounting, and ensure compliant revenue recognition.

Essential Integrations for Revenue Management Software

Integrations for revenue management software - ScienceSoft

  • Billing software - accurate revenue recording, reconciliation, and forecasting.
  • Order management system - timely triggered revenue recognition; comprehensive revenue analysis and forecasting.
  • Subscription management software (for subscription businesses) - timely triggered recurring revenue recording and recognition; accurate recurring revenue analysis and forecasting.
  • Treasury software - precise calculation of accrued revenue; timely revenue recognition.
  • Contract management system - automated SSP calculation and contract revenue allocation.
  • General ledger software - automated recording of revenue transactions under relevant accounts; accurate revenue reporting.
  • CRM - revenue data analysis for product and service offerings optimization.
  • BI solution - advanced visualization of complex revenue analytics.

Success Factors for Revenue Management Software

End-to-end revenue recognition automation

To eliminate time-consuming, error-prone manual tasks across revenue consolidation, estimation in complex multi-element arrangements, contract revenue allocation, and ensure revenue recognition accuracy.

ML-based revenue forecasting

To predict revenue amounts and various revenue-associated parameters (e.g., total accumulated deferred revenue at a specific date in the future) based on the analysis of historical interdependencies between revenue amounts, pricing strategies, customer demand, etc.

Comprehensive audit trail of revenue transactions

To detect potential revenue recognition fraud.

Revenue Management Software Implementation Costs and Financial Outcomes

Costs for building a revenue management system vary between $140,000 and $400,000, depending on the solution complexity.

Custom revenue management software may bring 95%+ annual ROI.

Benefits of revenue management software

  • 90%+

    manual revenue management tasks eliminated due to automation

  • 90%

    faster SSP (Standalone Selling Price) calculation due to automated analysis of historical pricing activity

  • 80+%

    faster revenue close due to automated revenue reconciliation

  • 80%

    more precise revenue forecasting due to complex multi-dimensional revenue analysis

  • Simplified

    revenue recognition compliance

  • Off-the-Shelf Revenue Management Software ScienceSoft Recommends

    Workday Revenue Management

    Best for

    Large enterprises that need to manage high-volume revenue transactions across multiple entities and currencies.

    DESCRIPTION

    Rating: Key player in the global revenue management and recognition software market (as per IDC).

    Key strengths:

    • Multi-entity, multi-book, multi-currency revenue management.
    • Automated revenue recognition for various revenue models.
    • Native integration with Salesforce CRM for end-to-end order-to-revenue management.

    Features:

    • Real-time consolidation of revenue transactions across multiple business entities.
    • Configurable revenue schedules, including multi-year schedules.
    • Support for various types of contracts and complex multi-element arrangements.
    • Deferred revenue reconciliation.
    • Calculation of key revenue metrics by user-defined dimensions (region, customer, product, etc.).
    • Scenario modeling and what-if revenue analysis.
    • Customizable revenue report templates.
    • Compliance with ASC 605, ASC 606, IFRS 15, region-specific regulations.
    • Comprehensive audit trail.

    Pricing

    Upon request to a vendor.

    Zuora Revenue

    Best for

    Mid-size and large subscription businesses.

    DESCRIPTION

    Rating: Key player in the global revenue management and recognition software market (as per IDC).

    Key strengths:

    • Automated recurring revenue recognition for various billing models, pricing and discount strategies.
    • Revenue forecasting based on the real-time subscription data.
    • OOTB integration with other Zuora apps, including Zuora Billing and Zuora Central Platform, to manage the entire subscription revenue cycle.

    Features:

    • Configurable revenue recognition triggers, revenue allocation rules, revenue close periods, and more.
    • Rule-based determination of the transaction price.
    • Automated SSP calculation.
    • Revenue allocation based on the calculated SSP.
    • Automated revenue re-allocation based on the mid-term contract changes.
    • Comprehensive revenue analysis taking into account COGS, sales commissions, rebates and accruals.
    • Multi-book and multi-currency support.
    • Compliance with ASC 606 and IFRS 15.

    Pricing

    Upon request to a vendor.

    Softrax Revenue Manager

    Best for

    Mid-size and large companies that want quickly and easily transit to the up-to-date revenue recognition standards.

    DESCRIPTION

    Rating: Key player in the global revenue management and recognition software market (as per IDC).

    Key strengths:

    • Multi-book revenue accounting and reporting under multiple revenue recognition policies.
    • Built-in BI for advanced visualization of revenue recognition reports.
    • Seamless integration with over 200 ERPs and financial systems, including Microsoft Dynamics 365, SAP, Oracle, Sage Intacct, etc.

    Features:

    • Configurable revenue recognition triggers.
    • Template-based revenue schedules.
    • Automated SSP calculation.
    • Automated foreign currency conversion.
    • Automated revenue reconciliation.
    • Drill-down revenue analysis by product line, business unit, contract type, market segment, and more.
    • Revenue forecasting.
    • Compliance with ASC 605, ASC 606, FASB ASU 2014-09, IFRS 15 standards.
    • Permission-based access control.

    Pricing

    Upon request to a vendor.

    When to Opt for Custom Revenue Management Software

    ScienceSoft recommends building a custom revenue management solution in the following cases:

    Off-the-shelf revenue management solutions do not provide compliance with the revenue recognition standards in the regions where your company operates.

    You want to avoid costly and effort-consuming integration of revenue management software with your corporate systems (order management software, a general ledger solution, a billing system, CRM, etc.).

    You need to automate non-standard SaaS revenue recognition and allocation processes based on your company’s specific revenue management policies.

    Implementation of Revenue Management Software with ScienceSoft

    In financial software development since 2007, ScienceSoft helps companies build reliable revenue management solutions.

    Revenue management software consulting

    • Analysis of your revenue management needs.
    • Suggesting optimal features, architecture, and tech stack for the revenue management solution.
    • Preparing an integration plan with CRM, order management system, billing software, general ledger solution, etc.
    • Implementation cost & time estimates, expected ROI calculation.

    Revenue management software implementation

    • Revenue management needs analysis.
    • Revenue management solution conceptualization.
    • Architecture design.
    • Revenue management software development.
    • Integrating the solution with existing corporate systems (CRM, order management system, billing software, general ledger solution, etc.).
    • Quality assurance.
    • User training.
    • Continuous support and evolution of revenue management software (if required).
    About ScienceSoft

    About ScienceSoft

    ScienceSoft is an international IT consulting and software development company headquartered in McKinney, Texas. We provide consultancy and development services to help organizations build effective revenue management software tailored to their revenue tracking, recognition, reporting, and forecasting needs. Being ISO 9001 and ISO 27001 certified, we apply a mature quality management system and guarantee that cooperation with us does not pose any risks to our customers’ data security. If you are interested in developing a reliable revenue management solution, turn to ScienceSoft’s team for custom revenue management software.