Changing subscription plans
As far as I understand, when a customer on an existing paid plan changes to a different plan, they are simply invoiced for the plan that they belong to at the end of the billing period. Furthermore, the billing period doesn't change when the plan changes, correct? My question is about this behavior with the added context of setup charges. Essentially we'd like all our plans to be charged up front for the month. It looks as if the only way to do that is to charge a setup fee for the first month of service, then treat each end of billing period charge as a fee for the next month. But, each of our plans would have a setup charge equal to the recurring charge. So, if I'm on plan A with setup cost $50 and recurring cost $50, and I change to plan B half way into the billing period, will I as a customer have to pay again for the setup charge (I assume yes here based on what I've read on your site) and also, importantly, will I be billed on the same billing schedule, such that I just had to pay a setup charge for the first month of service of the new plan when in reality I'm only getting 2 weeks of the plan before I'm getting billed again (on the schedule inherited from the previous plan)?
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1 Posted by david.ells on 05 Oct, 2009 04:56 PM
Related to this question, if I have a customer on a free plan who then upgrades to a paid plan, will they be billed on the "billing period" (start date) started with the free plan, or will their billing period begin when they switch to the paid plan?
Support Staff 2 Posted by Marc Guyer on 05 Oct, 2009 06:41 PM
Correct.
If a customer has paid a setup fee in the past and then change to a new plan with the same type of setup fee (determined solely by setup charge code), then the customer does not pay the setup fee when they change plans. If the setup charge code is different, then yes, they are charged for setup upon plan change.
Yes. The customers billing schedule is never changed. The start date of the billing period is always the same as the billing date for the last billed invoice.
Even if a plan is free, there is an invoice for zero dollars. So the same answer to the last question applies. One workaround would be to delete the customer account from CG prior to subscribing the customer to the paid plan. Then the customer's billing period begins at that moment.
More information about setup charges is available in the Setup Charge KB article.
Marc Guyer closed this discussion on 05 Oct, 2009 06:41 PM.
Support Staff 3 Posted by Marc Guyer on 06 Oct, 2009 03:01 PM
David -- We just deployed a change that I'm guessing you'll be happy about. If a customer changes from a free plan to a paid plan, the billing period for the new plan starts at the moment of the change. We consider this to be the desired behavior in every case so this is now the default in CG. This is only the case for free->paid. Not paid->paid or paid->free.
Please let us know if you have any further questions.