Question

I am putting together a proposal for a large multinational company for our licenced solution. Problem is I’ve never put together something this big before and so I don’t know what is acceptable. Ignoring hosting or support (or even the functionality of the app) for the moment and just concentrating the licence – do you think it’s more usual to do it on a per user basis – and if so would the company mind when prices fluctuate as more users come on board? Or is it more normal to do bands of users: 1-1000, 1000-5000, 5000-10000, 10000-25000, 25000-50000, 50000-100k, 100k+ (probably maximum usage). Does anyone know of any good links about this kind of thing? Has anyone here procured a complex, multilingual web app for 30000 users and how much is acceptable?

Answer 1

With big deals it’s usually discounted on each unit of whatever you’re selling so that you can scale with their volume. Probably makes sense to have a base price plus a per user license that scales with their usage. Another rule of thumb is that when you have a large purchase to get approved your sales cycle will be fairly long so it’s a good idea to price with that in mind. This a pretty good article by Joel Spolsky:

http://www.joelonsoftware.com/articles/CamelsandRubberDuckies.html

If you never took an econ course then this will help a lot.