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Create product rate plan charges

Zuora

Create product rate plan charges

After you have created a product and added a product rate plan, you can create one or more charges within the rate plan. Each charge can be one of three types: one-time, recurring, or usage-based.

Create a product rate plan charge

To create a product rate plan charge, complete the following steps:

  1. On the product details page, find the rate plan that you want to edit.
  2. Depending on the type of the charge to create, click add new under the One-Time ChargesRecurring Charges/Period, or Usage Charges/UOM section.
  3. In the Name section, specify a name for the charge and optionally provide a description.
  4. In the Charge Amount section, select the type of charge model. The charge model determines how the charge is calculated. For more information about supported charge models, see Charge Models.
  5. Complete the fields to create the new charge.
  6. Click Save.

The following sections provide three examples of setting up rate plan charges using different types of charges and charge models.

Setup fee (one-time, flat fee)

In a flat-fee charge model, the amount to charge is a fixed number applied to a one-time or recurring charge.

To create a one-time, flat fee charge, complete the following steps:

  1. Navigate to the rate plan that you want to edit.
  2. Within the rate plan, under One-Time Charges, click add new.
  3. Specify the following information:
    • Charge Name: Enter a name for the charge. For example, "Setup Fee".
    • Description: Enter a description for the charge. This field is optional.
    • Revenue Recognition Code: This field is displayed if your company has enabled revenue recognition fields. Select a revenue recognition code from the list.
    • Revenue Recognition Trigger: This field is displayed if your company has enabled revenue recognition fields. Select one of the revenue recognition trigger conditions.
    • Charge Model: Select Flat Fee Pricing from the list.
    • List Price: Enter a price for the set-up fee. You can change the list price when you add this charge to a subscription
    • Trigger Condition: Select a trigger condition from the list. The trigger condition determines when the charge will be applied.
  4. (Optional): Select an accounting code for the product from the list:
    • If you are using Zuora Finance, see Assign accounting codes for more information about using accounting codes in Zuora.
  5. (Optional): Depending on the enabled features for integration with Zuora Revenue, configure the following options in the Revenue Accounting section.
    Field name Description Feature enabled
    Exclude Item Booking from Revenue Select this checkbox to exclude non-revenue-related rate plan charges and order line items from syncing to Zuora Revenue. Order to Revenue or Zuora Billing - Revenue Integration
    Exclude Item Billing from Revenue Select this checkbox to exclude non-revenue-related invoice items, invoice item adjustments, credit memo items, and debit memo items from syncing to Zuora Revenue. Order to Revenue or Zuora Billing - Revenue Integration
    Revenue Recognition Timing Use this option to select the timing for revenue recognition. The available options depend on the revenue recognition policy configuration. For more information, see Configure revenue recognition policy. Order to Revenue
    Revenue Amortization Method Use this option to select the revenue amortization method. The available options depend on the revenue recognition policy configuration. For more information, see Configure revenue recognition policy. Order to Revenue
    Allocation Eligible Select this checkbox to include the charge segment for revenue allocation. Additional Revenue Fields
    Right To Bill Flag Use this checkbox to specify how to perform the accounting during revenue recognition. Additional Revenue Fields
    Product Category Use this field to specify the product category for integration with Zuora Revenue. Additional Revenue Fields
    Product Class Use this field to specify the product class for integration with Zuora Revenue. Additional Revenue Fields
    Product Family Use this field to specify the product family for integration with Zuora Revenue. Additional Revenue Fields
    Product Line Use this field to specify the product line for integration with Zuora Revenue. Additional Revenue Fields
  6. Click Save to save your changes to the rate plan.

Proration option for recurring charges

The proration option under the product rate plan charge level(recurring charges) allows you to select the proration behavior for a specific charge instead of using the tenant-level proration logic configured in the billing setting. Meaning you can have different proration behaviors for different settings. This feature is currently available at the normal recurring charge setting.

The Proration setting under the recurring charge billing and frequency provides the following options:

  • Default from tenant setting - Allows to follow the customer billing rule proration setting.
  • Charge the full period - Allows charging the full period amount for a partial billing period.

To manage and access this feature from the self-service interface, see Enable billing features by yourself.

Limitations

  • The proration option is accessible through the Order API, not the Subscription API.
  • You cannot update the term start date when the proration option is ChargeFullPeriod.
  • The recurring charge’s last billing period must be full when the proration option is ChargeFullPeriod.
  • When the proration option is ChargeFullPeriod, the billing cycle day must be the term start date, and the billing period must be aligned to the term start date.
  • You cannot update the recurring charge when the proration option is ChargeFullPeriod.
  • The suspend date must be the next billing period’s start date in the suspend order action.
  • You can only use this proration option for regular recurring charges. Prepayment charges, discount charges, and delivery pricing charges are not supported.
  • You cannot overwrite this value from CPQ, but you can still use CPQ to create such subscriptions if the proration option doesn't have to be changed from CPQ.
  • If the list price base year and the billing period are shorter, the proration option doesn't work.

Seat licenses (recurring, per unit)

Recurring charges can be billed on a monthly, quarterly, semi-annual, or annual basis. This example explains how to set up a monthly recurring charge using the per unit pricing charge model. In this type of charge model, the total amount to charge will equal the per unit price multiplied by the total number of units (quantity).

To set up a recurring per-unit charge, complete the following steps:

  1. Navigate to the rate plan that you want to edit.
  2. Within the rate plan, under Recurring Charges/Period, click add new.
  3. Enter the following information to create a new recurring, per-unit charge:
    • Charge Name: Enter a name for the charge. For example, you might call this "Ultimately Screen Capture Monthly."
    • Description: Enter a description for the charge. This field is optional
    • Revenue Recognition Code: This field is displayed if your company has enabled revenue recognition fields. Select a revenue recognition code from the list.
    • Revenue Recognition Trigger: This field is displayed if your company has enabled revenue recognition fields. Select a revenue recognition trigger condition.
    • Charge Model: Select Flat Fee Pricing from the list.
    • List Price: Enter the price for the recurring charge. You can change the list price later, if necessary, when you add this charge to a subscription.
    • List Price Base: Choose Billing Period, Month, and Week.
      • The Month option sets the list price based on a month charge. For example, if the list price is $100, the invoice for a 12-month period is $1200.
      • The Billing Period option sets the list price based on the billing period. For example, if the list price is $1200, the invoice for a 12-month period is $1200. 
      • The Week option sets the list price based on a weekly charge. For example, if the list price is $100, the invoice for a 12-week period is $1200.

        The Week option is in Limited Availability. If you wish to access this enhancement, submit a request at Zuora Global Support. We can help you evaluate if early adoption is right for you.

    • Trigger Condition: Select a trigger condition from the list. The trigger condition determines when the charge will be applied.
    • End Date: Select an end date option from the list. The end date option determines when the charge ends after the charge starts billing. 
    • Billing Period: The frequency with which the charge repeats. You can configure these options under Define Billing Periods. 

      The Subscription Term option allows you to choose the entire subscription term as the billing period. The List Price Base must be set to Month or Week.  See Recurring Charges for Different Initial and Renewal Subscriptions for more information.

    • Billing Day: Determines when the specific charge is billed. You can configure these options under Define Billing Periods.

      Selecting the Default from Customer Account option overrides the bill cycle day specified for the customer. For example, if you select the fifth of the month for the billing date, this charge will be billed every month on the fifth of the month, for all customers who have purchased this product. See Product Catalog Dates: Product Rate Plan Charge Date Attributes for more information about these settings. 

    • Billing Timing: Select In Advance or In Arrears.
    • Billing Period Alignment: Select a value from the list.
  4. (Optional): Select an accounting code for the product from the list. 
  5. (Optional): Depending on the enabled features for integration with Zuora Revenue, configure the following options in the Revenue Accounting section.
    Field name Description Feature enabled
    Exclude Item Booking from Revenue Select this checkbox to exclude non-revenue-related rate plan charges and order line items from syncing to Zuora Revenue. Order to Revenue or Zuora Billing - Revenue Integration
    Exclude Item Billing from Revenue Select this checkbox to exclude non-revenue-related invoice items, invoice item adjustments, credit memo items, and debit memo items from syncing to Zuora Revenue. Order to Revenue or Zuora Billing - Revenue Integration
    Revenue Recognition Timing Use this option to select the timing for revenue recognition. The available options depend on the revenue recognition policy configuration. For more information, see Configure revenue recognition policy. Order to Revenue
    Revenue Amortization Method Use this option to select the revenue amortization method. The available options depend on the revenue recognition policy configuration. For more information, see Configure revenue recognition policy. Order to Revenue
    Allocation Eligible Select this checkbox to include the charge segment for revenue allocation. Additional Revenue Fields
    Right To Bill Flag Use this checkbox to specify how to perform the accounting during revenue recognition. Additional Revenue Fields
    Product Category Use this field to specify the product category for integration with Zuora Revenue. Additional Revenue Fields
    Product Class Use this field to specify the product class for integration with Zuora Revenue. Additional Revenue Fields
    Product Family Use this field to specify the product family for integration with Zuora Revenue. Additional Revenue Fields
    Product Line Use this field to specify the product line for integration with Zuora Revenue. Additional Revenue Fields
  6. Click Save to save your changes to the rate plan.

Storage (usage, tiered with overage)

Usage-based charges are used to track resources that are metered and charged based on an amount consumed. In this example, a rate plan charge is set up for file storage with a minimum included storage units of 500 gigabytes (this is the amount of the included units) and an overage price for any storage used beyond the included units. The price for storage is based on tiered pricing in which charges vary progressively as the volume of storage units purchased increases. In this example, the final tier is considered overage.

Tiered with overage example

The following is an example of what a tiered pricing table might look like with an overage price:

Tier From To List Price Price Format
1 1 500 0 Per Unit
2 500 1000 .10 Per Unit
3 1000 3000 .08 Per Unit
4 3000 10000 .06 Per Unit
Overage Price .15 USD Per Unit Thereafter

Create tiered pricing with an overage usage charge

To set up a usage charge with tiered pricing and overage, complete the following steps:

  1. Navigate to the rate plan that you want to edit.
  2. Within the rate plan, under Usage Charges/UOM, click add new.
  3. Complete the following fields to create a new usage charge with a tiered with overage pricing charge model:
    • Charge Name: Enter a name for the charge.
    • Description: Enter a description for the charge. This field is optional.
    • Revenue Recognition Code: This field is displayed if your company has enabled revenue recognition fields. Select a revenue recognition code from the list.
    • Revenue Recognition Trigger: This field is displayed if your company has enabled revenue recognition fields. Select a revenue recognition trigger condition.
    • Charge Model: Select Tiered Pricing from the list. This causes additional fields to appear on the page.
    • UOM: The unit of measure (UOM) for the usage charge. The units of measure are defined by your company.
    • Rating Group: Select a rating group from the list. Usage is rated based on the rating group. This field is displayed only when you select the per unit, volume pricing, or tiered pricing charge model in the Charge Model field. See Rating Usages by Groups for more information.
    • Price Table: Enter the pricing for each tier, as well as the overage price to charge if there is an overage.
    • Trigger Condition: Select a trigger condition from the list. The trigger condition determines when the charge will be applied.
    • End Date: Select an end date option from the list. The end date option determines when the charge ends after the charge starts billing.
    • Billing Period: The frequency with which the charge repeats. Select a billing period from the list. You can configure these options under Define Billing Periods.
    • Billing Day: Determines when the specific charge is billed. You can configure these options under Define Billing Periods.

      Selecting Default from Customer Account for the billing day is a common practice. For example, if you select the fifth of the month for the billing date, this charge will be billed on the fifth of the month every month for all customers who have purchased this product. This setting overrides the bill cycle day specified for the customer. See Product Catalog Dates: Product Rate Plan Charge Date Attributes for more information about these dates. 

    • Billing Period Alignment: Select a value from the list.
    • Smoothing Model: Select a smoothing model from the drop-down list to allow your customers to roll over their usage. This is an optional field. See Overage Smoothing Charge Model for more information.
  4. (Optional): Enter an accounting code for the product.
  5. (Optional): Depending on the enabled features for integration with Zuora Revenue, configure the following options in the Revenue Accounting section.
    Field name Description Feature enabled
    Exclude Item Booking from Revenue Select this checkbox to exclude non-revenue-related rate plan charges and order line items from syncing to Zuora Revenue. Order to Revenue or Zuora Billing - Revenue Integration
    Exclude Item Billing from Revenue Select this checkbox to exclude non-revenue-related invoice items, invoice item adjustments, credit memo items, and debit memo items from syncing to Zuora Revenue. Order to Revenue or Zuora Billing - Revenue Integration
    Revenue Recognition Timing Use this option to select the timing for revenue recognition. The available options depend on the revenue recognition policy configuration. For more information, see Configure revenue recognition policy. Order to Revenue
    Revenue Amortization Method Use this option to select the revenue amortization method. The available options depend on the revenue recognition policy configuration. For more information, see Configure revenue recognition policy. Order to Revenue
    Allocation Eligible Select this checkbox to include the charge segment for revenue allocation. Additional Revenue Fields
    Right To Bill Flag Use this checkbox to specify how to perform the accounting during revenue recognition. Additional Revenue Fields
    Product Category Use this field to specify the product category for integration with Zuora Revenue. Additional Revenue Fields
    Product Class Use this field to specify the product class for integration with Zuora Revenue. Additional Revenue Fields
    Product Family Use this field to specify the product family for integration with Zuora Revenue. Additional Revenue Fields
    Product Line Use this field to specify the product line for integration with Zuora Revenue. Additional Revenue Fields
  6. Click Save to save your changes to the rate plan.