Does Your SaaS Product Need An Enterprise Plan

Most SaaS products are designed with the assumption that their customers are individual users or small businesses or growth-stage startups at best.

But many a time, a large enterprise needs some custom features, to add new ones, and to upgrade existing ones to meet its needs.

Enterprise plans cater to all these requirements fully and charge accordingly, based on the number of users in your organization or request volume or on other multiple pricing parameters.

This is key: An enterprise plan allows enterprises or large corporations to take advantage of economies of scale without having to worry about paying for every single user seat.

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For example:

Large Businesses May Require Custom Features

Many large-scale companies need their apps to perform specific functions and processes. For example, an enterprise billing software may come up with custom features like REST API support, hybrid pricing, consolidated charging and invoicing, and automated dunning that may not exist in a regular billing software tool.

Regular Plans May Work Out Very Expensive For Large Volume Needs

Some enterprises have very high volume needs, and they turn to SaaS products as it doesn’t make business sense to purchase multiple software licenses or invest in custom software for every feature requirement. But regular plans end up being too expensive for high volume requirements, therefore it’s important to adopt the ‘wholesale market’ mindset to land enterprise clients and retain them for years.

Enterprises May Need Additional Handholding — Onboarding, 24*7 Customer Support, Etc.

Enterprises need more than just basic application functionality; they also need assistance with setting up their applications and keeping them secure while they’re in use by employees who aren’t trained on how to use them.

Enterprise plans offer more robust security measures which keep most cyberattacks at bay. Also, enterprises have additional requirements such as 24*7 uptime and (almost no) waiting time before getting an answer from the customer service team.

What Kind Of SaaS Products Need An Enterprise Plan?

When it comes to SaaS products, enterprise plans are (almost) a must. Not only do these plans give you the option to scale your product in case of demand spikes, but it also gives you an opportunity to offer your clients additional services.

Enterprise plans differ from the per-user pricing offered by most SaaS companies. These plans have more flexibility, allowing businesses to choose the right model for their needs and budget.

Let’s take a look at three kinds of SaaS tools to better understand if you should offer enterprise plans:

SaaS Type 1

Many SaaS tools offer a digital version of legacy applications traditionally offered on-premises.

In other words, every time an enterprise buys a new CRM or ERP license or even just updates its existing one(s), they’re paying for a (new) platform and everything associated with it — from security to maintenance to support.

So, if your SaaS tool offers a digital version of legacy applications, you certainly need enterprise plans. This includes CRMs, ERPs, toll-free numbers, etc.

There are many different types of enterprise plans: from multi-tenant plans to consumption-based plans; from basic plans that offer basic functionality up to premium plans that offer advanced functionality and robust security.

SaaS Type 2

Enterprise plans are designed for agencies that have a large number of clients and need a way to manage and serve those clients.

They are also designed for agencies that want to use SaaS software in an enterprise environment but don’t want to build the infrastructure themselves.

Any SaaS tool that can be used by agencies as a white-labeled branded software should offer enterprise plans. The main reason for this is that it allows you to offer your clients the same feature set and performance as your company, but with the added benefit of being able to scale it up or down depending on their needs.

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An enterprise plan is typically priced at least three times the price of the standard plan offered by most SaaS companies and includes a number of bells and whistles. You most often see this type of plan named ‘enterprise’ or ‘agency’ or even ‘branded’.

SaaS Type 3

Enterprise plans are great for companies that have a lot of users and/or users who use the product for multiple purposes. But for SaaS tools that are used by a single or limited number of users, enterprise plans can be overkill.

Please note that SaaS products that are priced based on consumption volumes don’t need to offer enterprise plans as you already price with a straightforward pay-as-you-go model.

So, the companies pay for what they use. Think Amazon AWS.

This pricing strategy doesn’t compel companies to pay a fixed monthly subscription cost for full-fledged features and manage their spending as per their specific monthly needs.

Therefore, they don’t feel forced into paying a hefty sum whether or not their usage warrants it.

Pricing based on consumption volumes is perfect for companies of all sizes as they can leverage basically every feature of your tool and just pay according to their usage.

How To Price Your SaaS Product

SaaS pricing is a process that can be broken down into three main stages:

Product discovery — this is where you decide what your customers need and how you plan to solve it.
Product roadmap — this is where you establish the features of your product and how they will be delivered over time.
Pricing strategy — this is where you create an accurate and up-to-date pricing model based on customer needs and usage patterns, as well as how much it costs you to develop, maintain, support, and sell your product.

Now let’s take a look at different SaaS pricing models, and assess which one makes sense when offering an enterprise plan. You can pick one for your tool, or even use a combination of these to offer a feature-packed SaaS tool to your enterprise customers.

Per-User, Per Month

This is the most common model and is based on the number of users that you have (or will have) in a given month. It is further segregated as per the feature set and its corresponding monthly or annual pricing levels.

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But this SaaS pricing model makes no sense when it comes to an enterprise plan since enterprises pay higher (mostly) so they don’t have to shell out money for every user in their organization.

Per-User, Per Year

This model is more flexible since it allows you to increase or decrease your price based on the number of users that you have. However, it can also be more operationally expensive because it’s not as simple as getting paid for each user every month because you might need to hire additional staff if your business grows rapidly enough to require them. And this can significantly offset your ARR.

But you cannot craft your enterprise plan using this SaaS pricing model as it is identical to the previous one with just one change — the annual billing system.

Freemium Pricing

This is the most popular way to price a SaaS product, and it’s a mix of both per user and per month pricing. It’s also known as ‘freemium’ because it allows users to try out a product before they pay for it.This could be in the form of a free trial or a free version of the tool with limited functionality.

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A freemium model is typically used by startups who have launched their products to gain traction before they start charging every customer. You can add additional features to your freemium app as your business grows, so it’s possible to scale up without raising prices too much at first.

Freemium is an extremely popular SaaS pricing model, and most recently is commonly used by AI writing tools that offer free credits for users to test the waters before investing money in producing content.

Enterprises look to pay hefty money to fully use a SaaS tool. Since price-haggling or less features isn’t what they want, this SaaS pricing model isn’t relevant to the process of building an enterprise plan.

Fixed Pricing

This, on the other hand, offers a flat pricing or one or more tiers that users can choose from when purchasing the service. With this type of pricing, you decide upfront what your product will cost. You can also offer discounts and bundle packages at different levels, if you choose to go the tiered way.

The higher the tier you choose, the more features and capabilities users get with their account. For example, an $80/month plan might include everything in a $30/month plan plus a few extra features like additional storage or support options. A good example for this help desk software where the customer is priced based on the number of agents or seats.

A flat pricing model is perfect for enterprises as it offers no-holds-barred access to the entire SaaS tool for a fixed monthly/annual cost.

You can take inspiration from Basecamp, and test the waters with a flat-price enterprise plan.

Variable Price Or Pay-As-You-Go Model

The customer pays a variable amount for the software, services, or license based on monthly usage volume.

With no fixed monthly cost, this model provides companies with the freedom to switch up or down their usage as per their variable monthly budget. For example, SMS marketing software, cold email tools, and video personalization apps may charge users based on the monthly consumption metrics.

Most enterprises pick this SaaS pricing model for this reason alone. However, they may expect a massive discount for the large volumes they consume.

Which Pricing Model Should You Choose To Offer An Enterprise Plan?

You can A/B test the flat pricing and pay-as-you-go model, and see which one hits the chord the most with your enterprise customers.

And then fully adopt one price structure by making a data-backed decision.

Wrapping Up

Many small SaaS companies offer one plan to all customers, often a monthly or yearly subscription. While this may be the most practical option, it can also limit one’s customer base. If you wish to expand your business to enterprise-level clients, then an enterprise plan will be necessary.

Having said that, knowing when to offer an enterprise pricing plan can be difficult, but if you have enough critical mass then offering it may be something you should consider.

An enterprise plan should be something that you customize to meet the needs of your top-tier or high-volume customers or the companies that need the absolute best features and security for fixed/variable monthly or yearly pricing.

And your pricing and included features should reflect that consideration. It needs to stand out from all the other offers on the table, so it becomes a no-brainer and go-to plan for the companies that have deep enough pockets.

Let us know in the comments if you’re going to introduce an enterprise plan and which pricing model would you pick.

By Nestor Gilbert

Nestor Gilbert is a senior B2B and SaaS analyst and a core contributor at FinancesOnline for over 5 years. With his experience in software development and extensive knowledge of SaaS management, he writes mostly about emerging B2B technologies and their impact on the current business landscape. However, he also provides in-depth reviews on a wide range of software solutions to help businesses find suitable options for them. Through his work, he aims to help companies develop a more tech-forward approach to their operations and overcome their SaaS-related challenges.