Hey, I have a nuance pricing question! We're restru fb

Quick Post

Hey, I have a nuance pricing question!
We're restructuring our plans, and going to be requiring one time onboarding
fees. For example, with our middle tier plan it will be $197 per month + a one
time $1,000 onboarding fee.
As it sits, that would mean the first month they would be billed $1,197 and the
following months would be just the $197/mo
My question: Is it common practice to not charge the client for the first months
subscription ($197 in this case), when you have an onboarding fee?
I heard that from a mentor today, but I am not sure if they're correct. My
concern is I don't want our leads to assume they're getting that first month's
subscription waived in place of a higher onboarding fee, only to then be
unpleasantly surprised during the sign up process - which will of course lead to
lower conversions.
Excited to hear anyone and everyone's input!

Originally posted by Kyle Bigger on Facebook
link: facebook.com/groups/2044902829088090/user/100000734774117/

11 comments

eliav cohen

3 years ago

Checked out your site Propertyleads...How about skip the onboarding fee (I
typically don’t ever convert when there is an onboarding fee). Instead charge
$350 a month for your product and do a three month internal trial. If your
product works as stated, you’ll be fine.

kyle racki

3 years ago

Generally 10-20% of the first year is what gets charged for onboarding. I’d
recommend putting more on the subscription end - it seems a bit off balance to
charge about about half of the first year in onboarding

laura roeder

3 years ago

If they're willing to pay the 1k set up fee the ongoing fee should be no big
deal, I would definitely charge it

alex skinner

3 years ago

So my business works with a couple of hundred member organisations and I can
tell you that if they charge a join fee not too dissimilar it is entirely
separate from any subs, I would absolutely not want to create any association
between the two both need to be valuable in their own right

raymond castelyn

3 years ago

On boarding fees put people off, from what I’ve seen and experienced myself,
unless it’s rigours training that should be charged separate.

We all know it doesn’t take long to setup a new client unless there are very
specific integrations/customisation required, so I rather build it into the
pricing structure as a OH cost

hooman menshari

3 years ago

Sometimes if the client agreed to six months deal or one year commitment then we
will give them free setup fee and that will close the deal sooner and more
comfortable for the client. Also that means we beat the competition

jimmy weeks

3 years ago

Whether you waive 1st mo or charge it doesn’t matter as much as a separate line
item on invoice for bookkeeping and so client understands they are different
plus stripe is easier like tony said

mirzet kadric

3 years ago

For me, your subscription starts as soon as you closed the sale and they
want/need access to the software. Typically, prior to that they see a demo, a
free trial, a case study, webinar, etc.

The onboarding processes is a service you execute for them, but you could have
affiliated partners that do them later on. You never know what could block that
processes and kill your software sale.

I would charge the onboarding separately as this is a one-time service fee and
can't be accounted as a recurring revenues from a scalable SaaS. You don't want
any friction neither so you don't want to delay the product billing.

Feel free to reach out.

joshua morton

3 years ago

Regardless of what you decide as long as you’re setting proper expectations you
should be fine.

ssvs sarath

3 years ago

Nothing like that. We do charge setup fee which is one time and then monthly
billing. However, if there is NO setup and purely onboarding fee, it doesnt make
sense to charge first month billing (as a discount or offer to the client to
earn trust and confidence).

austyn chalifour

3 years ago

I have seen people do this, but they make them JUST pay the onboarding fee and
then thereafter they pay the monthly.

Share Post