Revenue Leakage
Revenue leakage is earned revenue a business is entitled to but fails to collect. In CSP, it usually comes from a gap between what was provisioned and what was billed, from unbilled or under-billed usage, or from manual errors in the billing process.
Key Takeaways
- The gap between revenue earned and revenue actually billed.
- Common in CSP from provisioning-to-billing gaps and missed usage.
- Small misses compound across a large subscription base.
- Reconciling every cycle is the direct fix.
Why revenue leakage happens in CSP
Subscriptions change constantly: seats added, services provisioned, usage moving day to day. When billing is manual, some of those changes never make it onto an invoice. Across hundreds or thousands of subscriptions, small misses add up.
How partners close the gap
Reconcile provisioning and usage against the provider invoice every period, so nothing billable is missed. Partners commonly recover a few percent of recurring revenue this way. GadellNet recovered 2 to 3 percent of revenue that had been leaking, and reached return on investment within three months, after moving CSP billing and reconciliation onto Work 365.
How Work 365 supports this
Work 365 reconciles subscriptions and usage automatically, so revenue you have earned is revenue you actually bill. See Billing and Invoicing.
Related terms: Subscription Revenue Leakage, CSP Revenue Leakage, Invoice Reconciliation, Reconciliation-Based Billing.
FAQ
How much revenue do CSP partners lose to leakage?
It varies, but partners commonly find a few percent of recurring revenue going uncollected before they automate reconciliation.
How do you stop revenue leakage?
Reconcile provisioning and usage to billing every period so every billable change reaches an invoice.
