How Pricing Works in Tabs
Last updated: June 4, 2026
Pricing in Tabs is configured on billing terms and determines how customers are charged. Depending on your use case, pricing can be configured as a fixed amount, based on usage, or based on seats.
Pricing Types
When creating or editing a billing term, you'll first select a Pricing Type.
Flat
Flat pricing charges the same amount every billing period.
Examples:
$500 per month
$2,000 per quarter
$12,000 per year
Flat pricing does not require quantities, usage events, or pricing tiers.
Usage
Usage pricing charges customers based on reported usage.
Examples:
API calls
Transactions
Messages sent
Data processed
Usage is billed in arrears because the usage must first be measured before it can be invoiced.
Seat-Based
Seat-based pricing charges based on the number of seats assigned to a customer.
Examples:
Number of licensed users
Number of employees
Number of active locations
Seat-based pricing supports proration and true-up settings for handling mid-cycle seat changes.
Pricing Models
For Usage and Seat-Based pricing, you must also select a pricing model.
Unit Pricing
Every unit is charged at the same rate.
Example:
Quantity | Rate | Total |
|---|---|---|
40,000 API calls | $0.10 per call | $4,000 |
Tiered Pricing (Graduated Tiers)
Each tier applies only to the units that fall within that tier.
Example:
Tier | Rate |
|---|---|
First 10,000 units | $0.10 |
Next 20,000 units | $0.08 |
For 30,000 units:
First 10,000 × $0.10 = $1,000
Next 20,000 × $0.08 = $1,600
Total = $2,600
Volume Pricing
The total quantity determines a single tier, and that tier's rate applies to all units.
Example:
Tier | Rate |
|---|---|
0–10,000 units | $0.10 |
10,001–50,000 units | $0.08 |
For 30,000 units:
30,000 × $0.08 = $2,400
Total = $2,400
Tier Configuration Options
Additional configuration options are available when using tiered pricing.
Charge Per Unit
The rate is multiplied by the number of units in the applicable tier.
This is the most common pricing configuration.
Charge Per Tier
Each tier has a fixed price regardless of where the quantity falls within that tier.
Example:
Tier | Price |
|---|---|
0–1,000 units | $50 |
1,001–10,000 units | $400 |
10,001+ units | $1,500 |
If a customer uses 4,200 units, they are charged $400 because they fall within the 1,001–10,000 tier.
Percentage-Based Pricing
Tiers can also be configured using percentages rather than fixed dollar amounts.
This is commonly used for revenue-sharing or take-rate pricing models.
Seat-Based Pricing Settings
Seat-based pricing includes additional options for handling seat changes during a contract term.
Proration
Proration determines how seat changes are calculated when they occur during a billing period.
Available options may include:
None
Daily
Monthly
Yearly
For example, if a customer adds seats halfway through a monthly billing period, proration can calculate a partial charge for the remainder of the cycle.
True-Ups
True-ups determine when charges for added seats are invoiced.
Common options include:
Immediate – Charges are invoiced as soon as the seat change occurs.
Co-Term – Charges are accumulated and invoiced on the contract's next scheduled billing date.
Additional Notes
Flat pricing does not use pricing models or tiers.
Usage pricing is billed in arrears because usage must be measured before invoicing.
Seat-based pricing uses the seat quantity defined on the billing term.
Pricing can be configured independently of the Product Catalog.
Best Practices
Use Flat pricing for predictable recurring fees.
Use Usage pricing when charges depend on customer activity.
Use Seat-Based pricing when billing is tied to licensed users or other seat counts.
Review tier definitions carefully before activating contracts to ensure expected billing behavior.