Delayed invoicing recommendation

This topic is about Metered usage V2. Marketplaces use the Metered usage V1 API, Metered usage V2 API, or both, to support metered usage billing. See also: Metered usage V1.

Metered usage V2 supports delayed invoicing. We recommend that you enable delayed invoicing for products configured for metered usage if you (the vendor) will be:

• submitting usage that is pre-configured for volume pricing. It ensures that late usage can be submitted before processing so that the correct total usage is calculated and the correct volume price is applied. (For volume pricing, you cannot make historic usage adjustments, so missed usage cannot be submitted after billing is processed for a period.)
• will not be submitting metered usage in real time as it is incurred by users. It reduces the risk that usage and charges are missed when usage for a billing period is invoiced.

Ideally, all metered usage for a billing period is submitted by the vendor before customers are invoiced for usage in the period.

When delayed invoicing is disabled (the default state), metered usage charges are included on the invoice that is generated the day after a billing period ends.

When delayed invoicing is enabled, invoicing for all charges except metered usage continues on the day after the billing period ends. However, invoicing for metered usage is delayed by a configured number of days (see the example and procedures in this topic). The delay gives Developers additional time to take the following actions before metered usage is invoiced:

• collect and submit all metered usage incurred in a period
• submit usage that is reported to them late
• correct errors that involve excess usage before they are invoiced

All of the above also reduces the need for retroactive usage and invoice adjustments (see Historic usage and adjustments).

Delayed invoicing price-per-unit example

A customer owns a subscription that starts January 1. It's for a product configured for a $100 prepaid monthly fee and metered usage.

• January 1: invoice is generated for January 1-31 monthly fee of $100
• January 1-31: metered usage with a value of $75 is incurred
• January 1-31: Developer submits metered usage with a value of $50
• February 1-28: metered usage with a value of $20 is incurred
• February 3: Developer submits metered usage incurred in January with a value of $25
• February 20: Developer submits metered usage incurred in February with a value of $20

If delayed invoicing is disabled:

• February 1: invoice generated for February 1-28 monthly fee of $100 and January 1-31 usage of $50
• March 1: invoice generated for March 1-31 monthly fee of $100, February 1-28 usage of $20, and January 1-31 retroactive usage adjustment of $25

If delayed invoicing is enabled with a 5-day delay:

• February 1: invoice generated for February 1-28 monthly fee of $100
• February 6: invoice generated for January 1-31 usage of $75
• March 1: invoice generated for March 1-31 monthly fee of $100
• March 6: invoice generated for February 1-28 usage of $20

Delayed invoicing volume pricing example

As recommended for volume pricing usage, delayed invoicing is enabled.

A customer owns a subscription that starts January 1. It's for a product configured with the following volume pricing:

• 0-100 units: $0.10
• More than 100 units: $0.08

Usage is submitted throughout the month and, when it is rated, the appropriate volume price is charged:

Delayed invoicing volume pricing example

January billing period usage dates	Example 1: Submitted usage	Example 2: Submitted usage
January 3	10	25
January 12	15	40
January 20	4	65
January 25	1	5
January 5 (submitted on February 3)	5	5
Total usage	35	140
Volume price per unit	$0.10	$0.08
Total charge	$3.50	$11.20
When delayed invoicing is enabled with a 5-day delay	On February 6, an invoice is generated for January 1-31 usage with a charge of $3.50	On February 6, an invoice is generated for January 1-31 usage with a charge of $11.20

To calculate the invoicing delay

If delayed invoicing is disabled, all invoicing occurs the day after the billing period: (end of billing period + 1 day).

If delayed invoicing is enabled, usage invoicing occurs as follows: (end of billing period + 1 day + x days delay). For example:

• The end of the January 1-31 billing period is January 31
• Non-metered usage invoicing will occur on January 31 + 1 day = February 1
• Metered usage billing configured with a 5-day delay will occur on February 1 + 5 days = February 6

To enable delayed invoicing

Delayed invoicing is enabled by product.

Developers: Contact your Marketplace Manager to request that they enable delayed invoicing for specific products and advise them of the number of days you want end-of-period usage invoicing to be delayed.

Marketplace Managers: Contact your AppDirect technical representative to request that they enable delayed invoicing for specific products and advise them of the number of days you want end-of-period usage invoicing to be delayed.