Appendix A — Pricing Strategy
What this appendix is
A short primer on pricing your tenants. This is opinion, not gospel. Your market and brand may push you in different directions.
The two pricing models
You can charge tenants in two basic shapes:
Pay-as-you-go (PAYG)
Tenant pays only for what they use. Common rates:
- $10-20 per extension per month
- $2-5 per DID per month
- $0.02-0.04 per minute (inbound + outbound)
- No monthly minimum
Pros: customers feel they're not over-paying. Easy to sell to skeptical buyers ("you only pay if you use it"). Low commitment.
Pros for you: higher revenue per minute (your wholesale per-minute is ~$0.012, retail at $0.025 = ~50% margin on minutes alone).
Cons: unpredictable revenue. Bad month for a tenant = bad month for you. Hard to forecast MRR.
When to use: new partners building book of business, consumer/SOHO market, tenants that don't know their volume.
Flat rate
Tenant pays a fixed monthly fee. Examples:
- $99/mo: 5 extensions + 2 DIDs + 500 minutes included; $0.025/min over
- $299/mo: 25 extensions + 5 DIDs + 2500 minutes included
- $599/mo: 50 extensions + 10 DIDs + 5000 minutes included
- $999/mo: 100 extensions + 20 DIDs + unlimited minutes
Pros: predictable revenue. Easier to sell to procurement-driven buyers. Higher customer lifetime value.
Pros for you: higher MRR predictability. Customer feels "all-you-can-eat" even if they're under their cap most months.
Cons: you eat overage cost if a tenant goes way over their included minutes. You leave money on the table for tenants who under-use.
When to use: B2B market, established partners with stable customer base, tenants who want a single line item on their P&L.
Hybrid (recommended)
Most successful partners offer both — a flat-rate "Standard" plan and a PAYG "Starter" plan. Customers self-select. Switch them between profiles as they grow.
Pattern: PAYG for trials and first 30 days, Flat Rate after they've stabilized. "Starter $99 includes 5 extensions; once you hit 8, we'll move you to Pro at $299."
Pricing tiers — practical numbers
A starting point. Adjust to your market.
| Tier Name | Monthly | Includes | Overage |
|---|---|---|---|
| Trial | $0 | 30 days, 2 ext, 1 DID, 200 min | n/a (cap is hard) |
| Starter | $99 | 5 ext, 2 DIDs, 500 min | ext $20, DID $4, min $0.025 |
| Growth | $299 | 25 ext, 5 DIDs, 2500 min | ext $15, DID $3, min $0.020 |
| Business | $799 | 75 ext, 15 DIDs, 8000 min | ext $12, DID $2.50, min $0.015 |
| Enterprise | Quote | Negotiated | Negotiated |
These are competitive with established VoIP resellers (Phonebooth, OnSIP, etc.). You can charge less if you're competing on price; you can charge significantly more if you're bundling premium support, white-glove setup, or SLAs.
Setup fees and one-time charges
Most successful partners charge for:
- Setup / onboarding — $200-1000 depending on size
- Number porting — $25-50 per number
- Hardware (desk phones) — your cost + 20-50% margin
- Custom call flows / IVR design — $250-1500 if you're doing it for them
- On-site installation — your hourly rate
These are on top of monthly fees. Frame as "investment" not "fee" — sets expectations for ongoing value.
What to actually charge
The honest answer: charge what your customers will pay. The above numbers are starting points. Run your first 5-10 sales without changing pricing. If you close 80%+, raise prices. If you close <40%, lower prices or fix your value proposition.
Most new VoIP partners undercharge by 30-50%. Customers don't pick the cheapest phone provider — they pick the most reliable, the easiest to work with, and the one whose support actually answers. Price like you're worth more than the competition because you almost certainly are.
What NOT to do
- Don't compete on price alone. Race to the bottom. Brutal margins. Difficult support. Avoid.
- Don't bundle minutes you can't sustain. If your wholesale per-minute is $0.012 and you sell unlimited minutes for $50/extension, an aggressive call center customer will eat your lunch.
- Don't charge per-feature. "$5/mo for voicemail-to-email" is hostile pricing. Bundle reasonable features. Only charge separately for things that have real per-customer cost (recordings storage, transcription minutes, phone hardware).
- Don't offer free toll-free. Toll-free per-minute is your cost. If you give it away, you lose money on every inbound minute. Charge $0.04-0.08/min minimum.
When to raise prices
Annual review is a healthy practice. Send your tenants a notice 60 days before any price change. Most won't churn over a 5-10% increase if your service is solid.
Don't raise prices to fix declining margins from your wholesale costs going up — your tenants don't care about your costs. Raise prices because you've added value.