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Rise of Usage-Based Pricing in B2B
In the last few years, usage-based pricing has become the go-to model for B2B technology. It promises flexibility to users: pay only for what you use, scale as you grow, and avoid heavy upfront costs. And guarantees scaling income for the vendor.
At first, it sounds like the perfect fit for fast-moving teams. But as businesses scale usage, the cracks begin to show. Behind every pay-per-use product, API, or feature, lies a layer of complexity that never makes the sales pitch: procurement friction, billing confusion, and internal drag because every action has a price tag associated with it.
Instead of simplifying spend, usage-based pricing often obscures it. Every invoice becomes a puzzle. Every vendor conversation involves spreadsheets, thresholds, and pricing calculators. Procurement stalls. Forecasting fails. And suddenly, buying software becomes incredibly complex and costly.
In this blog, we break down the fourth major challenge of usage-based pricing: procurement and billing complexity. We’ll explore how these hidden costs creep in, why they’re so disruptive, and what fast-scaling teams can do to fix it.
This follows a series of pieces covering major challenges for users in a transactional world: unpredictable costs, the ‘taxi meter’ effect , and technical lock-in.
Why Transactional Model Cause Problems
Complex pricing tiers, hidden fees, and unpredictable bills don’t just frustrate finance, they can grind procurement to a halt.
What should be a straightforward buying decision becomes a minefield of what-ifs:
- What if usage spikes unexpectedly?
- What happens if we exceed a threshold we didn’t know existed?
- What if the cost of this tech gets out of control?
These questions aren’t theoretical; they’re embedded in the procurement cycle. Finance teams spend weeks decoding rate cards and contract footnotes. Legal teams wade through liability clauses linked to overages. Product leaders are pulled into hypothetical usage modelling sessions.
It’s not just time-consuming—it’s a signal of the vendor-user misalignment that will define the relationship for the whole of the contract. Procurement is built to assess value, risk, and ROI, and usage-based pricing muddies all three. And when clarity disappears, so does confidence.
Billing That Breaks Down Trust
Behind every usage-based invoice is a team scrambling to make sense of it.
For example, when API bills spike there are a series of departments and activities that come into question:
- Engineering builds dashboards to track API usage by the hour
- Finance combs through itemised billing anomalies with spreadsheet macros
- Product is looped in to justify any spikes
- Sales and Marketing are brought into question why number has jumped
In part, this is because pricing models force organisations to forecast consumption they can’t fully control. A simple vendor comparison now involves guesswork around data usage, growth rates, edge cases, and overage penalties.
Pretty quickly, decision-making slows in what we call the ‘taxi meter effect’, teams start to hesitate on technology usage, and deals stall. And if you’re not careful, the usage-based model you get trapped with a vendor that no longer meets your needs. These are some of the major challenges businesses are facing today.
What should be a simple process turns into a saga of usage audits, pricing simulations, and procurement ping-pong.
How to Overcome Procurement and Billing Complexity
Getting on top of procurement friction starts by recognising its full cost not just the bill itself, but the internal time it takes to understand and manage that bill.
Track total costs
The full cost of complex because usage-based billing goes far beyond the initial price tag. To understand the full impact on your organisation, you need to track the total cost of consumption, including the time teams spend managing it. But be aware that overhead adds up quickly.
Invest in cost tracking
Invest in tools that remove the manual effort of cost tracking. Usage tagging, real-time billing alerts, and cost dashboards can help catch anomalies early—before procurement is dragged in to clean up the mess.
Switch to fixed-rate pricing
For critical infrastructure, especially services with high or unpredictable usage, consider technology vendors that offer flat-rate, unlimited-use models. It simplifies budgeting, removes back-and-forth with procurement, and often shortens decision-making cycles.
These suppliers align better with fast-moving teams and remove the need for a group of pricing decoders when every bill comes in or every contract comes up for renewal.
At TravelTime, for example, we designed our fixed-fee location API to eliminate these hurdles entirely. No metering. No sliding scale. No procurement headache.
Why Fixed Cost Models Matter
Flat-rate pricing makes procurement easier and unlocks operational benefits across your business.
When you eliminate the unpredictability of usage-based billing, you create space for teams to move faster, make better decisions, and focus on what matters.
Simpler Procurement Cycles
No more vendor comparisons based on hypothetical usage scenarios or fluctuating price tiers. Fixed pricing allows procurement teams to evaluate vendors based on capability, not complex consumption predictions.
Discover why companies choose TravelTime for search and match, routing, and spatial analysis.
Predictable Budgets
Finance teams can forecast spend with confidence. No more surprise spikes. No more chasing down the source of unexpected overages. This predictability empowers CFOs to allocate resources more strategically and reduces the friction between technical and finance teams.
Chat to TravelTime about our custom, fixed price model.
Faster Internal Alignment
When pricing is simple, everyone’s on the same page. Product doesn’t have to justify usage. Engineering doesn’t have to explain anomaly spikes. Everyone knows what the cost will be so decision-making gets faster and less political.
Innovation Without Friction
With usage detached from cost, teams are free to test, build, and ship without staring at the meter. Fixed pricing removes the tax of experimentation and empowers teams to solve problems creatively without financial anxiety.
Better Vendor Relationships
Fixed-rate suppliers are incentivised to deliver ongoing value, not just upsell on usage. This realigns incentives and builds long-term trust. Instead of worrying that your success leads to higher bills, you know your vendor is invested in your growth.
Escaping fixed-price models
Procurement complexity isn’t just a finance issue.
It slows innovation, stalls vendor onboarding, and undermines team trust. Usage-based pricing waste your team’s time decoding bills and not building products, feeling restricted by usage-related costs.
The solution? Buy simplicity and buy predictability. Buy from vendors that want to grow with you, not just meter you.
Chat with us to learn more about TravelTime’s fixed price model. Or get started with an API key for free.
