Custom Billing (Beta)

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Overview

Custom billing allows sellers to customize how a customer is billed throughout the duration of a contract. By providing flexibility in invoice amounts and payment collection timing, custom billing can entice prospects with a billing schedule tailored to their needs, while providing sellers with the guardrails to distribute the total contract value (TCV) accurately and seamlessly.

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Key capabilities

1. Customize invoice amounts within a standard billing schedule Set different billing amounts per period (monthly, quarterly, annual) while maintaining the TCV. Example: Distribute a $12,000 contract across 3 billing periods with $6,000, $4,000, and $2,000 installments, instead of the default monthly installment of $4,000. 2. Control when the first invoice is sent Select from the checkout date or contract start date. 3. Manage payment collection timing for credit card transactions The customer’s credit card will be charged according to the custom schedule.

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Editing an order with custom billing

When editing an open order, simply click the button on the right side of the page labeled “View/update billing schedule.” Any modification to the contract value (upgrades, downgrades, or changes to line items) will prompt a review of the existing billing schedule. If the new TCV does not align with the existing custom billing amounts, the system will detect the discrepancy and require corrective action.

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Examples

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Resolution

When discrepancies arise between the TCV and custom billing amounts, users will be presented with the following options:

Update billing schedule	Reset to standard billing and continue
Redirects to the billing schedule editor Users can reallocate the new TCV across custom periods Requirement: Adjustments must equal the revised TCV to proceed	Disables custom billing, reverting to equal payment distribution Users can process the order immediately and re-enable custom billing later

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How custom billing is displayed on invoices

Basic calculation formula Line item allocation % = (Original line item amount / TCV) * 100 Custom period amount for line item = (Custom period total * Line item allocation %) / 100 Example calculation Let’s say we have a contract with 2 line items and a TCV of $12,000, distributed across 3 months using custom billing:

• Month 1: $6,000 (50% of TCV)
• Month 2: $4,000 (33.33% of TCV)
• Month 3: $2,000 (16.67% of TCV)

The cost breakdown of the line items is as follows:

Line Item A	Line Item B
Subtotal: $9,000 Tax (7%): $630	Subtotal: $3,000 Tax (7%): $210

And here’s how the line items will be charged on each invoice: Month 1 ($6,000 - Multiplier: 0.5):

Line Item A	Line Item B
Subtotal: $9,000 × 0.5 = $4,500 Tax: $630 × 0.5 = $315	Subtotal: $3,000 × 0.5 = $1,500 Tax: $210 × 0.5 = $105

Month 2 ($4,000 - Multiplier: 0.3333):

Line Item A	Line Item B
Subtotal: $9,000 × 0.3333 = $3,000 Tax: $630 × 0.3333 = $210	Subtotal: $3,000 × 0.3333 = $1,000 Tax: $210 × 0.3333 = $70

Month 3 ($2,000 - Multiplier: 0.1667):

Line Item A	Line Item B
Subtotal: $9,000 × 0.1667 = $1,500 Tax: $630 × 0.1667 = $105	Subtotal: $3,000 × 0.1667 = $500 Tax: $210 × 0.1667 = $35

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Key points

• All amounts are rounded to the nearest cent
• Each line item is multiplied by the period’s ratio (multiplier)
• Tax is calculated using the same multiplier
• Original tax rates are preserved