Per-seat Pricing

Per-seat pricing, or per-user pricing, charges a set price for every person who has an account or licence, usually per month or year. A team of 25 on a 10-per-seat plan pays 250 each month.

Why it matters

It is simple to understand and budget, and revenue grows as a customer rolls the product out to more employees. It suits collaboration tools, CRMs and helpdesks where each person gets individual value. It works poorly when value comes from usage rather than headcount, or when automation reduces the number of people who need access. Buyers may also limit seats to save money, which can reduce adoption.

Example

Plan: 12 per seat per month, billed annually
Seats: 40
Annual cost = 12 x 40 x 12 = 5,760

Adding five people mid-year is usually prorated for the remaining months.

Common mistakes

• Counting inactive accounts as seats, or sharing one login to avoid paying; most terms prohibit this.
• Ignoring the difference between full and read-only users when designing plans.
• Forgetting minimum seat counts and annual commitments when comparing vendors.

Related

• Usage-based pricing
• Tiered pricing
• Subscription model
• CRM

This page is general information written by our editorial team and updated when documentation changes. Servers and providers differ, so test changes safely first. See our editorial policy and disclaimer.