Purchase Orders for B2B SaaS?

Discussions
#1

I’ve been transitioning from selling desktop software to web-based SaaS via subscription. For the one-time sales model, I accepted purchase orders from businesses, as it was expected for many (perhaps half?) of my customers. Now I’m considering whether to accept purchase orders for subscription products.

Does anyone in the b2b space have any insight regarding the percentage of business customers which expect to pay via PO for subscription products (~100 - 300 USD monthly or 1000 - 3000 USD annually) ?

#2

Paging @ian . He’s done some writing on purchase orders before; maybe has some insights.

#3

About half of our customers pay via invoice and I’d estimate about half to 3/4 of those have a purchase order.

We do have a lot of customers who started that way over the years. For a new business with a renewing credit card option available day one I wouldn’t be surprsied if it was somewhat lower, but I’d still expect PO’s to be popular at the higher tiers especially.

#4

Since POs are a pain to handle (compared to automated CC billing), I woudn’t like to deal with them for monthly payments. I’d ask customers to pay at least quarterly or yearly if they want to pay that way. Notice that I said “ask”, it’s all negotiable with bigger clients but you can at least suggest at first what’s most convenient for you.

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#5

Can someone please share a sample of the PO used for SaaS software and how it is different from a traditional PO?

#6

Erm - its the same.

The customer has its own PO format that it will send to you.

It likely uses exactly the same format for buying everything from pens to cars to software to services.