Cancellation Policy

Definition

A cancellation policy is a set of terms and conditions that outline the process and requirements for terminating a subscription or service, including any potential penalties or refunds.

Why it matters

For SaaS companies, a cancellation policy is vital because it sets clear expectations for customers and helps in managing revenue and resources. By clearly defining how and when a customer can cancel, it helps to minimize disputes and dissatisfaction. Additionally, it enables the SaaS company to forecast revenue more accurately and plan for potential churn. Overall, a well-defined cancellation policy enhances customer relationships and contributes to the sustainable growth of the business.