> ## Documentation Index > Fetch the complete documentation index at: https://alguna.com/docs/llms.txt > Use this file to discover all available pages before exploring further. # Alguna 101 > Learn about billing concepts with real-world examples Welcome This glossary explains key billing concepts with examples from companies you probably use every day. *** ## Billable Metrics Units of measurement that determine how much a customer pays based on their actual usage. **Real-world examples:** * **Twilio** bills per SMS sent or API call made * **AWS S3** bills per gigabyte of storage used * **Snowflake** bills per compute credit consumed * **Slack** bills per active user in a workspace Billable metrics let you charge customers fairly based on the value they receive, rather than a fixed fee regardless of usage. *** ## CPQ / Quotes Configure, Price, Quote — the process of creating customized pricing proposals for enterprise customers with complex needs. **Real-world examples:** * **Salesforce** enterprise deals with custom user counts, add-ons, and multi-year terms * **HubSpot** packages combining Marketing Hub, Sales Hub, and Service Hub at negotiated rates * **Snowflake** committed-use contracts with volume discounts based on projected consumption CPQ streamlines sales by letting reps build accurate quotes without manual calculations. The quote becomes the contract, which becomes the subscription. *** ## Discounts Price reductions applied to subscriptions or specific products. **Real-world examples:** * **Spotify** offers 50% off for students * **GitHub** provides free or discounted plans for startups and nonprofits * **Annual billing discounts** — most SaaS companies offer 15-20% off for paying yearly instead of monthly * **Volume discounts** — Slack gives lower per-seat pricing as team size grows Discounts can be percentage-based (20% off), fixed amount (\$50 off), or volume-based (price drops at certain thresholds). *** ## Currencies Support for billing customers in their local currency. **Real-world examples:** * **Netflix** charges €12.99 in Germany, ¥1,490 in Japan, \$15.49 in the US * **Shopify** displays pricing in local currencies while settling in USD * **Stripe** handles currency conversion automatically for global sellers Multi-currency billing reduces cart abandonment and improves customer experience by eliminating exchange rate surprises. *** ## Customers Entities that subscribe to your product or service. A customer profile contains billing details, usage data, subscription status, and payment methods. **Real-world examples:** * In **Slack**, a customer is an organization with a workspace * In **Figma**, a customer might be a design agency with multiple teams * In **AWS**, a customer is an account that can have thousands of users underneath Customers can have multiple subscriptions, payment methods, and billing contacts. *** ## Customer Portal A self-service interface where customers manage their own billing without contacting support. **Real-world examples:** * **Notion** lets customers upgrade/downgrade, add seats, and update payment methods * **Zoom** allows customers to view invoices, change plans, and manage add-ons * **Atlassian** provides usage dashboards showing active users across products A good customer portal reduces support tickets and empowers customers to make changes instantly. *** ## Invoices Detailed bills listing what the customer owes, including line items, taxes, and totals. **Real-world examples:** * **Monthly Slack invoice**: Base plan ($8.75/user × 50 users = $437.50) + taxes * **AWS invoice**: Hundreds of line items for EC2, S3, Lambda, RDS, etc. * **Stripe invoice**: Platform fees, connect charges, and payouts itemized Invoices can be sent automatically on a schedule or generated manually for one-time charges. *** ## Payment Transactions The process of collecting money from customers — capturing funds, processing through payment gateways, and recording for accounting. **Real-world examples:** * **Credit card charges** processed through Stripe or Adyen * **ACH bank transfers** for larger B2B transactions * **Wire transfers** for enterprise contracts * **Auto-pay** where saved cards are charged automatically when invoices are due Different payment methods have different processing times, fees, and failure rates. *** ## Pricing Models The structure that determines how products are billed. | Model | Example | | --------------- | ------------------------------------------------------- | | **Flat rate** | Netflix — same price for everyone | | **Per-seat** | Slack — pay per active user | | **Usage-based** | AWS — pay for what you consume | | **Tiered** | Mailchimp — different prices at different volume levels | | **Hybrid** | Salesforce — base platform fee + per-user licenses | See [Pricing Models](/pricing/pricing-models) for detailed configuration options. *** ## Products / Product Catalog The specific offerings your company sells, organized in a catalog. **Real-world examples:** * **Atlassian's catalog**: Jira, Confluence, Trello, Bitbucket (each sold separately or bundled) * **Microsoft 365**: Word, Excel, PowerPoint, Teams, OneDrive (bundled into plans) * **Zoom**: Meetings (core product) + Webinars, Rooms, Phone (add-ons) Products can be: * **Fixed** — same price regardless of usage (e.g., a software license) * **Metered** — price varies based on consumption (e.g., API calls) *** ## Usage Metering Tracking customer consumption to calculate what they owe. **Real-world examples:** * **OpenAI** tracks tokens consumed per API call * **Datadog** measures hosts monitored and logs ingested * **Vercel** counts bandwidth used and serverless function invocations * **MongoDB Atlas** monitors storage, operations, and data transfer Usage metering enables consumption-based pricing where customers pay proportionally to the value they receive. *** ## Plans Predefined packages with specific features, limits, and prices. **Real-world examples:** | Company | Plans | | ----------- | ------------------------------------------------------------------------------- | | **Spotify** | Free, Premium ($10.99), Family ($16.99) | | **Slack** | Free, Pro ($8.75/user), Business+ ($15/user), Enterprise Grid (custom) | | **Figma** | Free, Professional ($15/editor), Organization ($45/editor), Enterprise (custom) | Plans simplify buying decisions by bundling features into clear options. Enterprise plans often serve as starting templates for custom negotiations. *** ## Self-Serve Checkout The process where customers sign up and pay without talking to sales. **Real-world examples:** * **Canva** — select plan, enter card, start designing in 30 seconds * **Notion** — upgrade from free to team plan with a few clicks * **Vercel** — connect GitHub, pick a plan, deploy immediately Self-serve checkout captures customers 24/7, reduces sales costs for smaller deals, and provides instant gratification. *** ## Subscriptions An ongoing agreement where customers pay recurring fees for access to products or services. **Real-world examples:** * **Simple subscription**: Spotify Premium at \$10.99/month with monthly billing * **Annual contract**: Salesforce at \$1,500/user/year billed annually * **Complex subscription**: Enterprise deal with base platform fee + per-seat charges + usage overages + multi-year commitment + annual price escalators Subscriptions have: * **Billing schedule** — when invoices generate (monthly, quarterly, annually) * **Contract terms** — commitment length and renewal rules * **Price changes** — how upgrades, downgrades, and renewals are handled A single customer can have multiple subscriptions (e.g., separate subscriptions for different products or departments).