The market for subscription-based products has grown almost sixfold in the past nine years. You can subscribe to everything: grocery delivery, streaming services, online training, email newsletters, cleaning services, healthcare, etc. But how do they really work? Let’s find out!
Intro
Behind the success of all modern apps lies one crucial tool: subscription management software. This software automates billing, tracks subscriptions, manages customer lifecycles, and ensures compliance with financial regulations. It’s all done while providing businesses with insights to drive growth.
SapientPro is an experienced SaaS development company that provides subscription management software development services to global brands. We’ll share our 8+ years of experience to explain what is subscription management software, how does it work, and explain the development process.
What is SaaS Subscription Management Software?
SaaS subscription management software provides a platform for organizations to manage recurring revenues that result from subscription-based services. It automates key functions such as billing, invoicing, and payment collection with minimal manual interference, thus minimizing errors.
SaaS subscription management software provides a platform for organizations to manage recurring revenues that result from subscription-based services. It automates key functions such as billing, invoicing, and payment collection with minimal manual interference, thus minimizing errors.
Beyond payment processing, it also offers tracking customer subscriptions, renewal dates, and upgrade or downgrade management. These platforms also come with analytics that helps companies make sense of customer behaviors, forecast revenues, and determine the risk of churn.
Briefly, subscription management software is supposed to ease the operations of every business offering a subscription model service, be it a SaaS company, a media platform, or even a membership-based organization.
How complex is the development process? Subscription management software development is quite similar investment platform development. Check out our previous article to see the whole process.
Types of Subscription Management Software
Let's cover the 3 main subscription management software types and review how does subscription management software work.
On-Premise Subscription Management Software
On-premise subscription management software is installed and run on a company's local servers. It provides the organization with full control over the system and data. This is a traditional solution that finds applications in businesses that have to operate with tight data security and compliance. Although secure and highly customizable, such software requires substantial resources to be set up and maintained.
Key features of subscription management software here:
Fully hosted on-premise, with full control over data and operations;
Requires heavy upfront investments in hardware, software licenses, and infrastructure;
Customizable to meet the needs of an organization, yet reliant on in-house IT expertise.
On-premise solutions are ideal for industries requiring critical data handling like banking, healthcare, and government services. Here are some examples of subscription models:
Telecom subscriptions for enterprise-class services;
Healthcare services that are covered by tough privacy laws;
Utility billing systems for services provided, such as electricity or water.
The subscription models mentioned usually demand great accuracy and also regulatory compliance, which makes on-premise solutions very reliable.
Advantages include:
Full data control. Businesses retain ownership and control over all data, reducing risks associated with third-party hosting.
High customization. Systems can be adjusted to meet specific business needs and integrate deeply with existing infrastructure.
Enhanced security. Sensitive data remains within the company's controlled environment, which is essential in compliance-heavy industries.
On-premise software allows companies to tailor their systems to their unique requirements and avoid reliance on external service providers.
However, challenges also present:
High costs. High upfront hardware and licensing costs, plus ongoing IT support costs;
Limited scalability. Expansion requires additional infrastructure and resources;
Maintenance burden. IT teams must manage updates, patches, and system performance.
While it offers exceptional control, the heavy financial and operational investment can discourage smaller businesses. That’s why on-premises solutions are typically the best choice for large-scale companies.
SaaS Subscription Management Software
SaaS subscription management tools are cloud-based solutions accessible via a web browser. Their low starting prices, scalability, and ease of use have made them the standard for both big and small enterprises. SaaS systems are cloud-based, so regular updates don't bother the user, which makes for a smooth user experience.
Key features of subscription management software include:
Hosted in the cloud, therefore accessible from anywhere with an internet connection;
Subscription-based pricing, normally monthly or annual billing;
Quick to deploy, minimal setup required.
SaaS solutions appeal to businesses looking for flexibility and scalability without the complexity of infrastructure management. Here are some examples of subscription models:
Consumer-facing services like streaming platforms (Netflix, Spotify);
SaaS tools for businesses like SEO platforms (SE Ranking, Plerdy) or CRMs (HubSpot, Salesforce);
Subscription boxes, fitness apps, or e-learning platforms.
SaaS platforms are particularly useful for businesses that prioritize accessibility and customer experience.
Benefits include:
Ease of setup. No hardware or complex installations are needed. Businesses can start using the platform immediately.
Scalability. Cloud-based systems can grow alongside a business, adding capacity or features as needed.
Regular updates. Updates are handled by the software provider, and any new tools and security patches are accessible automatically.
SaaS tools save time and resources, which is a perfect fit for dynamic businesses in fast-moving markets.
However, challenges also present:
Data dependency. Businesses have to rely on providers to keep their data safe and up in the air.
Long-term costs. Despite low initial costs, subscription fees can add up over time.
Less customization. Compared to on-premise solutions, SaaS often has limited flexibility.
Nevertheless, all these challenges have not caused SaaS platforms to be in less demand because of their ease and flexibility. The SaaS model is the most affordable option for all businesses, minimizing internal IT load and maximizing achieved benefits.
Hybrid Subscription Management Software
Hybrid solutions combine the best of on-premise and SaaS models by offering flexibility to businesses for operating sensitive processes locally while scaling cloud-based features for optimal performance.
Such solutions are highly valued by organizations operating in complex compliance environments or migrating from traditional systems to modern platforms.
Key features of subscription management software here:
Combines local hosting for sensitive data with cloud capabilities for accessibility and scalability;
Lets businesses choose which functions stay on-premise and which will function in the cloud;
More complex to implement and manage than fully on-premise solutions and often SaaS solutions.
Hybrid systems are ideal for companies that must balance strict compliance requirements with the need to get new cloud-based functionality. Here are the examples of subscription models:
Financial services that manage sensitive customer data locally but use the cloud for customer portals;
B2B platforms that handle internal data on-premise while using cloud analytics for customer insights.
It is a hybrid solution that finds much relevance for enterprises operating in highly regulated markets.
Benefits include:
Balance of control and scalability. With sensitive data residing on-premise, the cloud can handle public-facing or scalable features.
Increased flexibility. Businesses can mix and match features based on operational priorities.
Transition-friendly. Perhaps best of all, it's also ideal for companies seeking to gradually make their transition from on-premise to cloud infrastructure.
This enables organizations to operate more efficiently without sacrificing control for sensitive operations.
However, challenges also present:
Complexity. The management and integration of the two systems require expertise, which might lead to synchronization issues.
Higher costs. Maintenance of two infrastructures could be more costly than selecting a single one.
Maintenance burden. On-premise and cloud components must be maintained by business entities.
Though hybrid models offer unique advantages, their complexity often demands serious planning and resources to implement effectively. However, they are considered to be affordable to most mid-tier businesses due to their balanced requirements.
Examples of subscription management software
Let’s take a closer look at the 5 examples of subscription management software to get a full understanding of all possible options for your business.
Chargebee
Chargebee is an enterprise-class SaaS subscription management product for any size of business. It specializes in handling recurring billing with automated workflows for subscription lifecycle management and compliance with global tax regulations. Chargebee maintains a large feature set, making it a popular choice to scale businesses quickly.
Chargebee provides multi-currency billing, allows custom subscription plans to be created, and automates invoicing. The analytics dashboard offers deep insights into customer behaviors, churn rates, and revenue trends.
Customer rating:
Capterra — 4.4/5;
G2 — 4.4/5.
Chargebee is a flexible choice for businesses desiring flawless integrations with major CRM and accounting platforms such as Salesforce, QuickBooks, and Xero.
Stripe Billing
Stripe Billing extends the powerful Stripe online payment processing platform to respond precisely to subscription-based businesses. Specifically, it is very popular among online businesses such as SaaS startups and e-commerce websites.
Stripe Billing allows businesses to create custom subscription plans, automate recurring billing, and generate detailed financial reports. Fraud protection and support for global payment methods make it secure and versatile. The API on the platform allows developers to make advanced customizations.
Customer rating:
Capterra — 4.7/5;
G2 — 4.4/5.
However, the pricing model for small businesses can be a concern.
Zoho Billing
Part of Zoho's extensive suite of business tools, Zoho Billing offers end-to-end subscription management. It is very well integrated into other Zoho apps, making it a great choice for companies that have already invested in the ecosystem.
Some of the important features of Zoho Billing include:
Automation of onboarding, cancellations, and tax compliance;
Customer self-service portals to simplify subscription modifications;
Advanced reporting features to effectively monitor revenue streams.
Customer rating:
Capterra — 4.5/5;
G2 — 4.3/5.
Users note some complexity in the onboarding process for extensive workflow setup.
SubscriptionFlow
SubscriptionFlow is a highly configurable subscription management platform designed for companies with very special and complex requirements. With a strong focus on automation and customer-facing features, it's agile for growing businesses.
It includes subscription analytics tools, tax compliance, and advanced customization of subscription workflows. Its ability to adapt to unique business requirements through integrations and API usage is second to none.
Customer rating:
Capterra — 4.8/5;
G2 — 4.8/5.
Users often praise its adaptability and strong customer support, while also expressing that the richness of features can sometimes overwhelm small teams.
Odoo
Odoo is an all-in-one open-source ERP with subscription management integrations. It's a perfect fit for companies that want an advanced level of personalization and control over subscription processes.
The Subscription Module helps enterprises manage recurring billing, contract management, and reporting. This can be integrated with other modules at Odoo like CRM, e-commerce, and accounting. Being open-source provides options for enterprises to do customization as per their specific requirements.
Customer rating:
Capterra — 4.2/5;
G2 — 4.3/5.
A minus could be that it has a steeper learning curve than SaaS options and also takes technical input for customization.
Cost of Developing Subscription Management Software
In subscription management software development, there is a need to balance costs against the scope of functionality, design, and scalability. A clear understanding of the SaaS development cycle and budget allocation is absolutely necessary to guarantee that resources are invested in features and infrastructure that align with your business goals.
Here is a detailed sheet describing the costs of development subscription management software. The evaluation is based on the industry’s average and our experience. If you want to get an estimate for your project, contact our team to get a detailed understanding of the expected costs.
Aspect
Description
Estimated Cost
Features and Functionality
Determines complexity and customization. Basic MVP with core features costs less than enterprise-grade solutions.
$50,000—$100,000 (MVP), $500,000+ (Enterprise)
Technology Stack
Modern technologies (e.g., Node.js, Python, AWS) ensure performance but increase costs.
Included in development costs
Design Complexity
A user-friendly UI/UX design tailored to the target audience.
$10,000—$50,000
Requirement Analysis and Prototyping
Researching, defining requirements, and creating prototypes.
$5,000—$20,000
Backend and Frontend Development
Includes subscription workflows, APIs, and payment integrations.
$50,000—$300,000
Testing and Deployment
Quality assurance testing and final production deployment.
$10,000—$30,000
Ongoing Costs
Maintenance, security updates, and cloud hosting services.
$500—$5,000/month
Team Composition
Project managers, developers, QA engineers, designers, and DevOps specialists.
$40—$200/hour per team member
Each project gets an individual estimate based on the expected features, technologies, and all essential aspects. We always provide a detailed evaluation in terms of costs and timelines for maximum transparency.
Ihor Hamal
COO at SapientPro
Summary
Subscription management software development goes far beyond a technical challenge.
It helps businesses:
Scale effortlessly;
Maintain amazing customer experiences;
Compete in the subscription economy.
While you can hire in-house subscription management app developers, you must expect the extensive spendings in terms of time and resources. SapientPro’s team can help you mitigate this issue by providing high-quality development services with our experts.
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