This article provides you two examples of how to handle special subscription term lengths using specific months billing period.
The ability to change your price plans on the fly provides you great advantage over competitors who have inflexibile product catalog. With Zuora, you can bill for standard periods (monthly, quarterly, annually) or you can have a custom charge that bills for a specific number of months such as 10 months, 13 months, or 18 months. The ability to create product rate plan charges with specific months billing is controlled in your tenant's Z-Billing Settings > Define Billing Periods > Customize Billings Periods (select Specific Months).
Example: Prepay a 10-Month Subscription
A customer would like to purchase a 10-month subscription beginning 02/01/2011 and is willing to pay the whole amount up front.
1. Create a product catalog rate plan charge for the product you want to offer for a 10 month billing period.
2. Create a subscription with this 10 month Charge
a. Initial Term and Renewal Term set as 10 months
b. Contract Effective Date = 02/01/2011
c. Process a bill run with Target Date = 02/01/2011
The invoice generated is for the ten month period.
3. If the customer decides they want to renew their subscription for an annual term instead of a 10 month term, an amendment (type = terms and conditions) can be created to change the number of months in the term and additional amendments can be created to switch out the 10 month product for an annual product.
Example: Extra Three Months for Free
Your company is offering a promotion that provides a customer customer who pays for a 12-month subscription with an extra 3 months for free. The initial subscription term length will be 15 months with a renewal term of 12 months. There are a few ways to handle the 3 months free and below is just one example. This example assumes the account bill cycle day is 1st of the month.
1. Create a subscription with an initial term = 15 months, renewal term = 12 months.
a. Add a product with an annual charge to the subscription.
b. Edit the charge information by clicking on the charge name and updating the following:
- Trigger Condition: Upon Service Activation
- Billing Day: Default from Customer Account
- Billing Period Alignment: Align to Charge
c. Click the save and activate button to fill the activation dates:
- Contract effective date: 01/01/2011
- Service activation date: 04/01/2011
2. Process a bill run with following dates:
a. Invoice Date: 01/01/2011
b. Target Date: 04/01/2011
The invoice generated will reflect a service period of 04/01/2010 to 03/31/2012, and a due date of 01/01/2011.