Understanding Pricing Proposals in RFP Responses
By Kevin Burgess on November 7, 2019
Once the responses to your grant management Request for Proposal (RFP) start rolling in, especially if it’s your first foray into grant management software, you will likely come across some new language and terminology. The pricing section of these responses tends to be one of the most complex – and the most important.
To help you better evaluate responses, we are highlighting some of the most common grant management software pricing terminology and explaining what it could mean for your organization.
Pay-per-users vs. Unlimited users
The right grant management software payment plan for you depends on the scope of your grant processes. The most common payment plans typically fall under either pay-per-user or unlimited users. For those managing smaller grants with fewer individuals involved in the process, a pay-per-user plan likely makes the most sense as you can avoid spending money on unneeded licenses.
If your grant scope is larger, for instance if you have a lot of sub-recipients or your organization is very grant-reliant, then an unlimited user payment plan may be best for you. With an unlimited plan, you won’t have to worry about constantly requesting new licenses, and the lump sum is typically cheaper than paying every time you add a license.
Annual grant revenue vs. Payment based on variables
Some grant management software providers will base your personalized pricing model on your Annual Grant Revenue. This type of plan is directly scalable to the grant programs you are managing with the software. Other providers will look at it from other variables, such as number of recipients, types of users, number of grant programs, number of grants, integration with outside systems, etc. This approach is geared towards customers looking for a more customized approach to grant management. When choosing which of these options are best for you, start with considering if you are looking for a solution developed to manage your grants right out-of-the-box or a more custom-built solution.
Subscription Plan vs. Accrued Fee-Based Plan
Sometimes grant management software providers include everything in the first payment plan. This means that the proposed payment plan includes setup, training, implementation, etc. upfront, and you will have a set annual payment for the duration of your contract. If you are looking for predictability and consistency, this type of subscription payment is better for your organization.
For organizations wanting a custom solution, especially in legacy systems, they are likely to encounter more instances of accrued fee-based payment plans. This means the organization would pay an initial price for certain parts of the service and the rest of their payment will come in the form of separate fees throughout the contract, such as maintenance fees.
Each organization and agency is different, so the best payment plan will always vary. Understanding the different forms of grant management software payment options, however, is the first step to using pricing to help guide your choice of grant management software.