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Recurring Charge for Different Initial and Renewal Terms

This article explains how to set up a recurring charge using the subscription term as the billing period and a list price based on a month. This type of recurring charge setup lets you create subscriptions with different initial and renewal terms.

This scenario explains how to set up a recurring charge to handle subscriptions with a different initial term and renewal term, and a list price based on a month. Suppose you have the following scenario:

  • Your customer subscribes to service with an initial term of 6 months and a renewal term of 12 months.
  • You want to bill and collect payment for the entire initial term at the start of the term. For example, if the initial term is May 1 through October 31 (6 months), the customer receives an invoice that includes a charge of $600  upon the term start date of May 1.
  • You want to bill and collect payment for renewal term at the start of the term. For example, if the renewal term is November 1 through October 31 (12 months), the customer receives an invoice that includes a charge of $1200 upon the term start date of November 1.

Using full-term pricing options, you can create a recurring charge on your product rate plan with:

  • A billing period based on the subscription term
  • A list price based on a month

Upon renewal, a preview of a subscription will look like the following:

Subscription Preview upon Renewal

Enable Zuora Billing Settings for the Billing Period and List Price Base

You must enable full-term pricing by defining your Invoice Period Settings. These steps show the required settings for full-term pricing. You can specify other Invoice Period settings as required for your business needs.

See Define Billing Periods for more information on all billing period settings.

Navigation: Click your username at the top right and navigate to Billing > Define Billing Periods

  1. Select Subscription Term from the Custom Billing Periods section. This option lets you define a billing period as a subscription term.
  2. Select Per Month from the Customize List Price Base section. This option sets your list price based on a month. 

Create a Product Using Full-term Pricing Options

Navigation: Products > Product Catalog in the left-hand navigation section

Create a new product in your product catalog and create a new rate plan.

The following  example shows a product rate plan charge that is set up for recurring charges with subscription term as the billing period and a list price based on a month:

Shows the List Price and List Price Base fields.

 

Do the following from your product rate plan:

  1. Add a new Recurring Charge.
  2. Define the charge amount:
    • Charge Model: Flat Fee Pricing
    • List Price: $100 with the list price base option of Month. For example, if your subscription term is 6 months, the charge for the full-term is $600. If your subscription term is 12 months, the charge for the full-term is $1200. 
  3. Choose a Trigger Condition.
  4. Choose Billing Period: Subscription Term
  5. Choose a Billing Day.
  6. Choose Billing Period Alignment: Align to Charge 
  7. Save the charge.

Create a Subscription

Navigation: Customers > Subscription in the left-hand navigation section and select add a subscription

See Create a Subscription for detailed steps on how to create a subscription.

The following example shows a subscription with an initial term set to 6 months and a renewal term set to 12 months:

Subscription with a 7-month Initial Term and 12-month Renewal Term

Do the following to see the impact on the invoicing:

  1. Activate and save the subscription. 
  2. Renew the subscription term.
  3. Preview the subscription with a preview date set after the start of the renewal term (as shown at the start of this article).
Last modified
01:12, 15 Nov 2016

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