License based pricing

Sujit Kumar
Aug 23, 2017 · 2 min read

It is the software industry which made license based pricing most popular. But when it applies to them, they find it very hard to accept.

Once when i was selling a private class for a Scrum course to one of the top global IT firm, we were going to create history in terms of the number of participants. It was more than 110 participants for a two day course. Even the trainer never imagined it.

The company took approx 2 months time to decide upon the date to have such a large batch together from different locations across US. Some physically there, some remotely.

But, the deal got little more interesting before coming to close.

A trainer charges normally 1100$ for a 2 days classroom Scrum course for an individual. For 100, it can’t be 100*1100, and you will sure think of charging 80% of it. Harder bargain ok 75%. close?

NO!!!

The firm asked me out of blue (literally Blue), why we charge so much more when it’s not going to affect the trainer. Be it 1 or 10 or 150, it would be the same effort from trainer. So, he shouldn’t charge so much! And it took me hours to convince him how the efforts do multiply for additional student in physical class. The very reason, we limit the students in any school. He was obstinate that they won’t ask question, but just listen.

But, it wasn’t a recorded session!

Little back and forth, finally we closed it at 70%. How we got that 70% is another story to tell…

Licenses aren’t as well just charges, but charges to support you in future. and somewhere support the research for better future products or services.

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Sujit Kumar

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Vice President, Valuebound. Solving Digital challenges! Open source Enthusiast!