This pricing method allows you to create a product that has tiered pricing depending on the usage threshold that you configure.
Step 1. Create a new product.
Go through the motion of creating a new product by referring to the How To Create A New Product section. Choose a rating method that makes sense to have tiered pricing such as Usage, One Time Charge, Subscription, etc.
Step 2. Specify the rate details
You have the ability to skip defining the default rate for the product for later definition when provisioning to a customer or when it is added to a package as a package product. For the purpose of this process, we will define the default rate for the product that you created.
Click the Specify Default Rate checkbox and select "Tiered Pricing" for the Pricing Type.
Finally, enter the rate corresponding to the currency code that the product will be used for, considering the pricing bands for your tiered product.
Refer to table 1 below for the field definitions to help you populate the rate details.
Click Submit to save the changes.
|Tiered Rate Type||
Only applicable for Tiered Pricing, this allows for choosing the behavior of how usage data is handled for tiered rates. Available choices are:
|Tier Calculation Level||
Only applicable for tiered pricing, this indicate the aggregate level of the tiered rates. Available options are:
|Tier Calculation Grouping||A table that allows the selection of fields relative to the ACTIVITY entity using the object reference model. Tier calculation will be aggregated/grouped according to unique values of the field(s) defined in this table. As long as there is a link from the ACTIVITY entity to the desired grouping field/entity, it can be referenced.|
|Use Tier Price as Flat Rate||
Setting Flat Rate flag will price the activity at a flat rate of a tier, without multiplying the rate by the cost. In case of the Incremental pricing the cost of each tier < quantity of rated activity will be added up for final cost. In case of the Bulk pricing only one flat rate will be used based on the corresponding tier for quantity on activity.
|Split Usage Crossing Bands||
Applicable only if Tiered Rate Type is set to "Incremental". When dealing with large chunks of data, enabling this option will allow the splitting of usage data across bands. Disabling the option will have the large chunk rated against the highest band attained.
|Band Billing Component (if different than self)||
Use this if the usage data to be tiered is coming from another product. For example, if the tiered product is a phone subscription and you want to influence how much the subscription charge will be for customer based on his/her minutes usage, this field will have the usage product.
Otherwise, the tiered pricing will be based on the usage of the phone subscription product itself.
Indicates the type of pricing that the product will use. Available options are:
Pricing plan effective start date.
Pricing plan effective end date.
Pricing rate of the product for each band.
This specifies the ceiling on which the band will take effect. For example, if you are charging for a product in such a way that: Usage of 0 - 100 is charged at 0.1, then 101 - 500 at 0.07, and then 501 and up at 0.05, the rating band will looking something like:
Leaving the Upper Band field blank can only be done for the top-most tier. This means that anything in excess of the last band with an upper threshold will be rated using the pricing for the band with a blank Upper Band value.