Hi,

This is for reference only really. I would like to know what pricing scheme a) you use or b) attracts most signups to your hosting company.

Thankyou!

We prefer to bill monthly.

I would have to say monthly..
Reasoning is:
If u get nothing but 3, 6 or 12 months paid up-front and customer cancels it 2 months into it. Its more of a hassle to send that person their refund (which may not be easy to do at that time).
Monthly they cancel it and only a small amount comes back out ur pockets. ;)

Monthly billing is nice. It makes partial refunds easier (if someone cancels half-way into a month, it's easier to give them their whole $10 back than when someone cancels 6 months into their yearly billing cycle and you have to pay them half their money back.)

monthly i like best

Monthly is better for many reasons another of which includes the worth of the company. Monthly accounts owe you each month where an annual account can be seen as a debt rather than an asset (you owe them 9 months of hosting). It's also better _if_ you are thinking of selling. Many accounts that are "due" vs. many accounts that do not owe a dime for another "3 to 12 months".

On the flip side of the coin, annual accounts bring in more cash immediately which can help you to build your business faster. This is where many hosts enjoy the annual payments as it gives them a greater amount of cash to work with for the immediate needs.

For the Site Owners it seems to work both ways... Some prefer monthly so they can "opt-out" easily and/or due to financial constraints (lower fees spread out over the year rather than a big lump sum), while others prefer the annual approach so they can receive the discounts that are commonly given for annual payments and/or so they do not need to worry about payments throughout the year.



<edited for typo corrections>
dept != debt
own != owe
</edit>

We prefer monthly and quarterly billing.

Monthly:
Pros: 1. You receive money to your bank account every single month - positive cash flow.
Cons: 1. Must pay per each transaction to your merchant account (it adds up very fast). 2. You have to deal with a lot of billing issues - mostly because of expired credit cards.

Quarterly/Annually:
Pros: 1. You receive one big juicy batch of money - could help companies who are just starting out (you can sign up about 10 people and already pay off your bills for one month). 2. It instantlly puts your clients into a contract. 3. You save money from merchant transactions - which only occur four times or one time a year - intead of twelve.
Cons: 1. You must support your client for a long period of time without seeing money from them monthly. If you sign up a certain amount of people one month who pay quarterly or annually only, and you sign up few or zero people next month - you realize that you are going to be in debt.

This is based on my personall experience - varies for everyone.

Sorry Deb and Bogdan...

Originally posted by Deb
...an annual account can be seen as a dept rather than an asset...

Originally posted by Bogdan
...sign up few or zero people next month - you realize that you are going to be in dept.

Debt is spelled "debt" not "dept".

See http://www.dictionary.com/search?q=dept

VS.

http://www.dictionary.com/search?q=debt

Sorry, I didn't mean to step on any toes. I just though that it was odd that both of you spelled debt the same way.

Oh, by the way, in my opinion monthly billing is much better. It allows you to project where your company will be financially in the future; based on these projections you could obtain funding easier and it may also assist you in making some decisions like whether to purchase more equipment or hire new employees.

i voted monthly, as that's the standard and is easier, and thought i'd also add:

ew! daily! sorry, but that seems to me to be a really slimy and obvious way of making the price seem cheaper, however only makes it more complicated. if you're going to bill yearly, state the yearly price.

It is always my customers choice, not mine - I just make sure to offer them their prefernace - and not to bother them with silly details ;)

Sorry, I didn't mean to step on any toes. I just though that it was odd that both of you spelled debt the same way.
:look:
:eek:
:laugh:

Thanks to everyone who responded to this poll.

It seems Monthly Billing is most popular with resellers and sign ups alike - so I will go with that. Please continue to post your opinions though as it is always helpful to hear your point of view.

Thanks

why dont u do both options monthly and annually?

Offering both options is fine for a plan that would make enough.

To offer monthly it is only really worth it for a plan over £4/$5 per month. A yearly plan would be around £10/$15 so i could price accordingly.

Of course we could offer the same plan for a monthly and yearly fee - with the monthly paying more with a cancel at any time offer, and yearly being cheaper.

we bill resellers monthly
we bill the public quarterly

had a few annuals in the past, the upfront cash is nice
however if you try to sell, the annuals are considered a debit

Originally posted by xerocity.com
[B]
Debt is spelled "debt" not "dept".
]

Hehe.. I just noticed we both spelled it wrong. :-)

Thanks for pointing it out.

we bill resellers monthly We let both resellers and the public choose monthly or annually etc, but I sure wish I had thought about billing Resellers monthly only. That's a great idea and for those not already set in their ways (read: stuck) I'd ponder that idea seriously.