Various approaches to billing


Jun 23, 2020



There are several approaches one can take when they need to collect money from their customers. The range is truly vast from simply taking cash to having an incredibly robust ERP system that manages billing for you.

Let's take a look at how a young company can approach this incredibly important component.

In-house/proprietary system billing

With this approach, you are not relying on any other system to generate invoices/credit notes/record payments. If you accept credit cards, then at most you will connect to a separate credit card processing company like Stripe, Square, Paypal, Braintree and others.

However, everything else you are doing in your own code. Your customer/user accesses your website, logs in, adds their credit card and payment gets processed. They are able to view and download invoices directly.

Benefits of this approach are numerous:

  • your billing page is part of your overall website, so from UI/UX perspective it is very intuitive and smooth
  • you fully control what is happening with the information, how many credit cards you allow to be accepted, how invoices look, etc
  • virtually free to run, as typically doesn't much cost to cloud computing/storage

Disadvantages can also be quite significant:

  • since your proprietary billing system is part of your accounting system, you need to regularly reconcile the two, which adds extra time/labour
  • it takes time to build one
  • depending where your customers are, you need to be extremely careful with how your handle their payment information

Dedicated billing solution

While not a full General Ledger system, a separate system provides with many advantages. Ease of use and often quick time to deployment are very appealing. Companies like Chargebee, Chargify or Recurly draw a lot of users because of this.

Depending on complexity of your billing process (number of products, frequency, notifications, payment methods, etc) there could be a learning curve to work through.

Expect to pay a combination of a monthly fee + a percentage of revenues collected for both Chargebee and Chargify. When you are just starting out, the monthly fee of ~ $300 will be higher than the percentage of revenues, but as your company grows to charge $100K+ you are looking to pay over $1K per month for the billing platform.

Let's take a look at the pro's and con's for this approach.


  • Easy implementation, depending on the plan you chose you may get additional help from the support team
  • Tried and tested - most popular systems like Chargebee or Chargify have been around for years, so the systems have been proven to work reliably for many other users
  • Saves developer hours - with a simple product offering, your billing process will be easier to scale and you will not require a developer at all


  • Could be very costly, as your company grows
  • May not be an ideal solution for companies with many product offerings or complex billing process
  • Not a full double-entry General Ledger, so you will still need to integrate the billing platform to a separate accounting tool

Billing module integrated with accounting system/ERP

While this approach is ideal from accounting perspective, you may be limited by features your accounting or ERP system provides.

Many SaaS companies with several product offerings will do very well with the billing functionality Quickbooks Online or Xero provide. However, for a much more complex billing setup or number of users your company may benefit from implementing an ERP like Netsuite or Dynamics 365.


  • Virtually unlimited flexibility to your billing needs
  • Seamless connection between billing and general ledger/reporting


  • Cost range is vast - from $40/month for Quickbooks or Xero to $10K+/month on Netsuite
  • Proper implementation may take long time
  • Training team may take long time

Which path to choose

The biggest factor here is complexity of your products/plans.

With a simple product offering I would advise growing companies to use billing functionality of the chose accounting system like Quickbooks Online or Xero. This will be a very integrated approach, which will not cost you anything extra.

If you find your products are difficult to manage, then a dedicated system like Chargebee will be a great option. You will need to invest a little bit of time to learn the tricks of the system and deploy it, but actually using a dedicated system will be easier than billing directly out of Quickbooks/Xero.

Deploying a functional ERP system is typically not advisable until a later point in company’s life due to complexity and cost factors.

Need help with your billing/bookkeeping process?

Send us a message and we will chat.