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Posted Apr 7, 2022
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6 min read
Monthly vs. Annual Contracts: Is It Time To Reconsider Your Annual Plan?
SaaS businesses love annual contracts.. The simple logic has been: "You show your commitment to me with a longer contract and cash upfront, and in return, I will give you a discount."
It sounds like a perfect arrangement for the customer and for you. Getting customers to commit to one, two, or even three years and pay upfront will improve retention rates, CAC payback, and cash, right?
Wrong, at least for retention and CAC payback. And in the end, perhaps cash too.
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