Concept
Tiers are one of the levers available to broaden your modeling possibilities. They allow you to implement progressive pricing using different tiers and calculation models.
There are tiers:
- with included quantities (free)
- with billed quantities
Among the advanced pricing options, you can choose to implement tiered pricing or volume-based pricing.
Examples:
Unit-based Calculation Model
1. An offer includes 2 licenses. For any additional licenses beyond 2, the price is €15 per month per unit.
Additional tiers can be created:
| Tier | Min Quantity | Max Quantity | Unit Price |
| 1 | 2 | 5 | €15 |
| 2 | 6 | 10 | €12 |
| 3 | Above 10 | (No limit) | €8 |
1st Tier – The addition of the 3rd, 4th, and 5th licenses will be billed at €15 per month per unit.
2nd Tier – The addition of the 6th, 7th, …, and 10th licenses will be billed at €12 per month per unit.
Last Tier – Any licenses added beyond 10 will be billed at €8 per month per unit.
- Tiered Pricing:
For the addition of 12 licenses, the billed price will be:
(3 * 15) + (5 * 12) + (2 * 8) = €121 - Volume-based Pricing:
For the addition of 12 licenses, the billed price will be the price of the last tier reached:
12 * €8 = €96
Lot-based or Flat-rate Calculation Model
In ProAbono, it is possible to define price calculation properties within a tier. This adds a new dimension to how features are billed.
Prices can be defined as:
- Unit-based
- Lot-based
- Flat-rate per tier
2. An offer includes 2 licenses. For any additional licenses beyond 2, the licenses will be billed in different ways.
| Tier | Min Quantity | Max Quantity | Option 1 Unit Price |
Option 2 Price per lot of: |
Option 3 Flat-rate Price |
| 1 | 2 | 10 | €15 | 2 = €25 | €99 |
| 2 | 11 | 26 | €12 | 4 = €40 | €149 |
| 3 | Above 26 | (No limit) | €8 | 10 = €69 | x |
Option 1:
It is possible to use unit-based pricing:
1st Tier – The addition of the 3rd, 4th, …, 9th, and 10th licenses will be billed at €15 per month per unit.
- Tiered Pricing:
For the addition of 36 licenses, the billed price will be:
(8 * 15) + (16 * 12) + (10 * 8) = €392 - Volume-based Pricing:
For the addition of 36 licenses, the billed price will be the price of the last tier reached:
36 * €8 = €288
Option 2:
It is also possible to imagine lot-based pricing:
1st Tier – Here, licenses are added in multiples of 2. The addition of the 3rd and 4th licenses will be billed at €25 per lot of 2.
- Tiered Pricing:
For the addition of 36 licenses, the billed price will be:
(4 lots * 25) + (4 lots * 40) + (1 lot * 69) = €329 - Volume-based Pricing:
For the addition of 36 licenses, the billed price will be the price of the last tier reached:
4 lots * €69 = €276
Option 3:
Finally, it is also possible to implement a flat-rate pricing for the tier:
1st Tier – Regardless of how many licenses are added within this tier, the price of the tier will be billed at €99 per month.
- Tiered Pricing:
For the addition of 24 licenses, the billed price will be:
€99 + €149 = €248 - Volume-based Pricing:
For the addition of 24 licenses, the billed price will be the price of the last tier reached:
€149
In these examples, it can be observed that different pricing methods can be defined for each tier, providing flexibility in billing quantities