How does onboarding software pricing work? Onboarding software pricing can work in several different ways. It all depends on the company and the product or service you choose. It’s important to have an understanding of your billing plan. That way you can determine if a particular onboarding solution is affordable for your business. When you are requesting pricing from any vendor, be sure to ask about additional fees. That might include fees for training, setting up custom forms, and other services related to the onboarding software.
Traditional Licensing
Some of the big name software companies still use a licensing model for their HR software—including onboarding applications. This means billing goes out based on an annual or another predetermined time period for one or more licenses depending on the number of end users. For example, if more than one satellite office uses the software as well as the corporate headquarters, each copy of the software might have its own license. Watch for additional fees for maintenance, upgrades, and other incidental services associated with the software. You may need to sign a contract that runs for several years in order to obtain reasonable pricing. After signing the agreement, it may be impossible to switch to another vendor. At least, not without paying a penalty for early cancelation.
Modern SaaS Model
Most onboarding software systems are bill out on a monthly basis using a subscription model. Companies might be charged a fixed rate based on the size of their organization. There’s an assumption that hiring will be fairly consistent year over year. Or, as with Efficient Hire, the cost may be directly tied to consumption. This is the most common onboarding software pricing model. That’s because it allows organizations to only pay for what they use.
PEPM (Per Employee Per Month)
Even with a consumption-based model, there are still different ways to come up with a total price. A “Per Employee Per Month” or PEPM option is based on the number of employees who are on payroll within a company. This number is reviewed once per month (such as during the first pay period). The total cost is calculated for that billing period. In the onboarding industry, this option makes sense for Payroll Service Bureaus that are dealing with a high volume of hires on a routine basis.
Per Transaction Pricing
A common option for onboarding software pricing for typical employers is the Per Transaction model. This is the simplest pricing structure. That’s because it is simply a flat fee per new hire, billed on a monthly basis for the hires that month. With this model, employers pay only for their actual use of the software. Therefore, you’ll find it a very attractive price point. It’s easy to scale up based on seasonal demand and down if hiring is slow. For example, the customer doesn’t pay at all for the software if there is a hiring freeze. However, they can easily ramp back up to full capacity when economic circumstances change.
Pricing for Special Products
At Efficient Hire, we offer both PEPM and per transaction models based on the type of customer and how they use the product. For additional services like Affordable Care Act reporting, a per form fee may be assessed. For WOTC (Work Opportunity Tax Credit) forms, the price is simply a small percentage of the actual credit amount. Our goal is always to give customers a fair price while helping them save time and money on onboarding. In almost every scenario, choosing a smart onboarding solution does exactly that. To learn how well our onboarding software pricing works for your business, contact our team today.
