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Plan Model

The plan model defines when and how much a customer is charged.

Plan interval

The plan interval corresponds to the billing period and defines when invoices are generated. In most cases, the charges are also calculated according to the plan interval.

There are several plan intervals:

  1. Weekly: subscription fees and charges are billed on a weekly basis (Monday to Sunday);
  2. Monthly: subscription fees and charges are billed on a monthly basis; and
  3. Yearly: subscription fees are billed on a yearly basis and charges can be billed monthly or annually.

The base charge amount and its currency

You need to define a base amount for each plan (i.e. the subscription fee). This amount is what the customer will pay by subscribing to the plan regardless of their consumption.

This base charge amount is recurring, and billed at the end of each billing interval.

Pay in advance or in arrears

With Lago, you can define if the base charge of the Plan is paid in advance or in arrears.

  • If the toggle is off (boolean set to FALSE), the Plan is paid for the past period (in arrears).
  • If the toggle is on (boolean set to TRUE), the Plan is paid upfront (in advance) for the period.
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Note that this toggle only affects the base amount of the Plan. Additional charges for per-usage Billable metrics are always paid in arrears because they are linked to a past consumption of your customers.

The trial period (optional)

You can decide to apply a Trial period for a Plan. This means your customers can test the Plan without being charged for a certain number of days. This is optional and if the value is null, the Plan holds 0 day of trial.

Note that the trial period can only be specified in days. A pro-rata is applied to the Plan regarding the number of days offered.

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A trial period can only be applied to the first subscribed Plan. In case of an upgrade or downgrade, the trial period of the new Plan is not applied.

Pro-ratas based on subscription date

Obviously, we know that your customers don't necessarily sign up for a Plan at the very begining of each month (or each year). This is why Lago automatically applies a pro-rata for the first and the last subscription period of a Plan.

Here is an example: A Customer X signs up for the Plan Start (base amount of 10€, with no trial period) on April 15, 2022.

  • If the Plan is defined to be paid in arrears, this Customer will be charged 5€ for the first month at the end of the period (May 1, 2022).
  • If the Plan is defined to be paid in advance, this Customer is charged 5€ straight away for the first month (April 15, 2022).
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Note that pro-ratas can also be applied in case of upgrades or downgrades.