> ## Documentation Index
> Fetch the complete documentation index at: https://docs.sequencehq.com/llms.txt
> Use this file to discover all available pages before exploring further.
# Usage-based pricing
> Sequence supports a range of standard and usage-based pricing models
## Linear pricing
Charge a single, linear rate for usage.
* `$0.1` per unit
* `550 units = $55.00`
Examples: [OpenAI - GPT-3 Davinci](https://openai.com/pricing/)
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## Linear pricing (Percentage-based)
Charge a single, linear percentage-based fee for usage. You can optionally set a minimum and a maximum fee threshold. For example, charge 0.5% of every payment event with a \$1 minimum and a \$10 cap per payment.
* `0.5%` per payment
Calculation for 50 payments amounting to `$1,000` = `$1,000` \* `0.5%` = `$5.00`
Examples: [Stripe - Invoicing](https://stripe.com/gb/invoicing/pricing)
## Linear pricing with fee thresholds
Use minimum and maximum fee threshold to charge a predictable amount for transactions.
* `2.00%` per payment, `$1.00` minimum unit fee, `$10.00` maximum unit fee
Calculation for 3 payments of `$25`, `$100` and `$500`:
* `2.00%` of `$25.00` = `$0.50` -> `$1.00` minimum fee applies
* `2.00%` of `$100.00` = `$2.00` -> Within min and max fee threshold
`2.00%` of `$750.00` = `$15.00` -> `$10.00` cap applies
Total: `$1.00` + `$2.00` + `$10.00` = `$13.00`
Examples: [Stripe - Invoicing](https://stripe.com/gb/invoicing/pricing)
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## Volume pricing
Offer volume discounts for higher usage and an optional flat fee per usage tier. Customers only pay the unit and flat fee in their current tier.
* Tier 1: 0 - 100 units @ `1$/unit` + `$20` flat fee
* Tier 2: 100 - ∞ units @ `$0.75/unit` + `$50` flat fee
Calculation for 125 units: `125 * $0.75 + $50 = $143.75`
Examples: [Twilio - SMS](https://www.twilio.com/sms/pricing/)
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## Volume pricing (Percentage-based)
Similar to standard volume tiers, but the unit price is a percentage of a sum (e.g., total transactions). Customers only pay the percentage and flat fee in their current tier. Optionally configure a unit cap that applies to each percentage charge (e.g. 0.2% of transaction volume, capped at \$5 per transaction). For percentage-based volume pricing, you can optionally set a minimum and a maximum fee threshold. For example, charge 0.5% of every payment event with a \$1 minimum and a \$10 cap per payment.
* Tier 1: `0 - $10,000` @ 0.1% + `$500` flat fee
* Tier 2: `$10,000 - ∞` @ 0.05% + `$250` flat fee
Calculation for `$15,000` Transaction volume: `$15,000 * 0.05% + $250 = $325`
Examples: [Stripe - Payments](https://stripe.com/pricing)
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## Graduated pricing
Charge multiple rates for multiple tiers (similar to progressive income tax), with an optional flat fee per tier. Tiers and flat fees accumulate.
* Tier 1: 0 - 500 units @ `$0.5/unit` + `$500` flat fee
* Tier 2: 501 - ∞ units @ `$0.7/unit` + `$750` flat fee
Calculation for 600 units: `500 * $0.5 + $500 + 100 * $0.7 + $750 = $1,570`
Examples: [Amazon Web Services - S3](https://aws.amazon.com/s3/pricing/)
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## Graduated pricing (Percentage-based)
Similar to standard graduated tiers, but the unit price is a percentage of a sum (e.g., total transactions). Tiers and flat fees accumulate.
* Tier 1: `0 - $10000` @ 0.1% + `$500` flat fee
* Tier 2: `$10000 - ∞` @ 0.05% + `$250` flat fee
Calculation for `$15000` Transaction volume: `$10000 * 0.1% + $500 + $5000 * 0.05% + $250 = $762.50`
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## Packaged pricing
Charge a fixed price for a package of units (similar to linear rate but with packaged quantities). Also known as stair-step pricing.
Pricing: `$10` per 250 units
Calculation for 600 units: `3 Packages * $10 = $30`
## Credit burndowns
Offer credit grants that customers can burn down each month. Unused credits are rolled over to subsequent billing periods. If all credits are burned down in a period, overages apply.
Credits: `$250` for 1500 API credits (no expiry)
Overages: `$0.10` per credit
Calculation for 1600 units: `100 * $0.10 = $10`
To implement this pricing model, grant credits to customers via API or dashboard. In addition to usage-credits (tied to a usage metric), you can also offer cash credits. Learn more about [credit grants](/credits/overview).