Subscriptions Overview

Subscriptions are the heart of recurring revenue. They connect customers to your products, automate billing cycles, and handle the complex lifecycle of ongoing customer relationships. GetPaidHQ manages all the intricate details so you can focus on delivering value to your customers.

What is a Subscription?

A subscription in GetPaidHQ represents an ongoing agreement between you and a customer. It defines:

• What they're subscribing to (product variant)
• How much they pay (pricing)
• When they pay (billing cycle)
• How they pay (payment method)
• Current status (active, paused, canceled, etc.)

Think of subscriptions as living entities that evolve over time - they can be upgraded, downgraded, paused, resumed, and eventually canceled, all while maintaining a complete history.

Subscription Lifecycle

Core Subscription Concepts

Billing Cycles

Subscriptions run on defined cycles:

• Start date - When billing begins
• Current period - Active billing period
• Next renewal - When the next charge occurs
• Anniversary - Same day each month/year

Subscription States

Subscriptions move through various states:

• Active - Normal, recurring billing
• Trialing - In free trial period
• Past Due - Payment failed, attempting recovery
• Paused - Temporarily suspended by customer
• Canceled - Scheduled to end at period close
• Expired - Ended after cancellation

Payment Timing

Two main approaches:

Charge in Advance (Default)

• Bill at the start of each period
• Common for SaaS and subscriptions
• Customer pays for upcoming month

Charge in Arrears

• Bill at the end of each period
• Common for usage-based billing
• Customer pays for past usage

Proration

When subscriptions change mid-cycle, GetPaidHQ automatically calculates fair adjustments:

Upgrade Example:

• Basic plan: $50/month
• Pro plan: $100/month
• Upgrade on day 15 of 30
• Prorated charge: $25 (half month of $50 difference)

Downgrade Example:

• Pro plan: $100/month
• Basic plan: $50/month
• Downgrade on day 10 of 30
• Prorated credit: $33.33 (20 days of $50 difference)

Subscription Components

Items

Each subscription contains one or more items:

• Primary item - The main product/variant
• Add-ons - Additional products or features
• Metered items - Usage-based components

Schedule

Defines when things happen:

• Trial end - When free trial converts
• Current period - Start and end dates
• Cancel date - When subscription ends
• Pause/resume - Temporary suspension dates

Metadata

Track additional information:

• Customer data - Account IDs, user counts
• Feature flags - What's enabled
• Custom fields - Your business-specific data
• Source - How they subscribed

Common Subscription Patterns

Free Trials

Let customers try before buying:

14-day free trial → $49/month
- No payment required to start
- Card captured but not charged
- Automatic conversion at trial end
- Cancel anytime during trial

Freemium

Free tier with upgrade path:

Free Plan (Always free)
→ Upgrade to Pro ($29/month)
→ Upgrade to Business ($99/month)

Usage-Based

Pay for what you use:

Base subscription: $99/month
Includes: 10,000 API calls
Overage: $0.01 per additional call
Billed: Monthly in arrears

Seat-Based

Scale with team size:

$15 per user per month
Minimum: 5 seats
Proration: Add/remove users anytime
Billing: Monthly, based on peak usage

Subscription Management

Customer Self-Service

Enable customers to:

• View current plan and usage
• Update payment methods
• Upgrade or downgrade
• Download invoices
• Cancel or pause

Administrative Controls

Your team can:

• Apply discounts
• Extend trials
• Change billing dates
• Waive fees
• Override prices

Automation Rules

Set up automatic actions:

• Upgrade at usage thresholds
• Downgrade after inactivity
• Cancel after X failed payments
• Notify at milestone dates

Handling Edge Cases

Failed Payments

GetPaidHQ's dunning process:

1. Immediate retry - In case of temporary issue
2. Smart retry schedule - Optimized retry times
3. Customer notification - Email about payment issue
4. Grace period - Keep service active
5. Final attempt - Last chance notification
6. Subscription action - Cancel, pause, or downgrade

Plan Changes

Smooth transitions between plans:

• Immediate - Change takes effect now
• End of period - Change at renewal
• Scheduled - Change on specific date
• Proration - Fair billing adjustments

Pausing Subscriptions

Options for temporary suspensions:

• Vacation holds - Known return date
• Financial hardship - Reduced or paused billing
• Seasonal business - Recurring pauses
• Feature freeze - Maintain access, stop billing

Cancellations

Multiple cancellation strategies:

• End of period - Honor paid time
• Immediate - Stop now with refund
• Scheduled - Cancel on future date
• Win-back - Retention offers

Best Practices

Subscription Analytics

Track key metrics:

Revenue Metrics

• MRR - Monthly Recurring Revenue
• ARR - Annual Recurring Revenue
• ARPU - Average Revenue Per User
• LTV - Customer Lifetime Value

Growth Metrics

• New subscriptions - Acquisition rate
• Upgrades - Expansion revenue
• Downgrades - Contraction rate
• Churn - Cancellation rate

Health Metrics

• Payment success - Collection rate
• Dunning recovery - Saved subscriptions
• Trial conversion - Trial to paid rate
• Reactivation - Win-back success

Common Questions

What happens when a credit card expires?

GetPaidHQ can automatically update card details through card network updater services. For cards that can't be updated, the dunning process begins with customer notifications.

Can customers have multiple subscriptions?

Yes! Customers can subscribe to multiple products or multiple instances of the same product (e.g., projects with separate billing).

How are refunds handled?

Refunds can be full or partial, applied to specific charges or periods. GetPaidHQ tracks all refunds and updates revenue reporting accordingly.

What about compliance and taxes?

GetPaidHQ handles tax calculation, invoice generation with required details, and maintains audit trails for compliance requirements.

Next Steps

Dive deeper into subscription concepts:

• Pricing Models - Explore different ways to charge
• Pricing Use Cases - Real-world examples
• Dunning Management - Recover failed payments