Our current step in the process takes us to Unit 12: Creating new subscription service products.
In the previous unit, we successfully created an allowance template. We are now ready to create a new product in the system based on an existing rate plan template.
The product is the service your customers subscribe to. The product defines the markets the service can subscribe to and where to draw the conditions for these markets. A market in this context is a logical representation of a part of your organization selling services for a well-defined region. We are now ready to create a new product in the system based on an existing rate plan template.
Let's create a new product based on an existing rate plan template.
Before we move on, there is an important concept to understand: think of Printing4You as a printing service provider, not a printer sales company. The customer does not own the printer. Instead, a monthly based fee is charged for a service package. This includes a printer, printer ink, paper, and a maintenance plan to keep things running.
Let’s review the information we’ll need to create our new product:
A fee of 29,95 € is charged at the beginning of each calendar month. For partial months, the fee is prorated. Each printer has a per printed page charge calculated for each month. This service offers standard prints on standard paper (80 g/m²) in DIN A4 format and premium photo prints on glossy paper in DIN A4 format.
Each standard printer comes with 100 prints at no extra charge for the first year. After a year, any unused prints will expire.
The monthly bill identifies each printer and its location for easy referencing. Printing4You also offers discounts of 10% for individual prints and 2% for the base fee.
Prices for prints follow a tiered logic according to the following table:
Products Overview
What are Products?
First, let’s describe a product in a subscription. Products predefine the basic data of the subscriptions that you sell for services and digital goods. This information includes rate plans that define pricing and billing for different markets. There are presets that govern the lifecycle of subscriptions for individual products. One main product and multiple sub-items can be contained in a single subscription. Furthermore, each sub-item is represented by a product which you define in this app.
When you open the Manage Products app, a list displays existing products in the Subscription Billing tenant. Select the Create button on the upper right of the list to create a new product.
Know Your Subscription Types!
We begin setting up a new subscription service product by selecting the Manage Products app and selecting "Create" on the list displaying all existing products. Under the General Information tab, enter the product name followed by an ID. A description is optional.
Next, select a subscription type. There are several subscription types to choose from depending on your needs, whether for Commercial, Internal Billing, Trial/Beta, or Test, as follows:
- Commercial
- Commercial is one of the most used types. Products assigned to the commercial subscription type lead to bills that are relevant for invoicing. Invoicing takes place in an integrated or external invoicing system.
- Internal Billing
- With Internal Billing, bills are created but no invoice documents are required. A flag is set for these bills by the bills API, which allows iFlows downstream systems to react accordingly. You can use internal billing to calculate costs associated with the use of a product.
- Trial/Beta
- With Trial/Beta, usage data is collected but bills and invoice documents are not created. You can use trial/beta subscriptions to enable customers to try out a product. Usage is free of charge and can be limited.
- Test
- Select Test to ensure no bills are created. Use Test to test subscriptions when you do not require rating, billing, or invoicing.
Creating a Subscription Profile
After selecting a subscription type, select a subscription profile. Subscription profiles and Subscription Billing work together to integrate other needed solutions and how to replicate subscriptions to these solutions. Subscription Billing integrates with an SAP S/4HANA Cloud tenant or an SAP Convergent Invoicing System. Let’s have a look at these settings:
Select the video below to learn about creating a subscription profile!
Summary
After selecting a subscription profile, you may continue setting an external reference. Let’s look at setting an external reference now.
Other Configurable Items in the Manage Products App: External Reference
An external reference identifies your product in other systems, such as a material number.
Below the External Reference field are two switch buttons that allow more configuration. Create Subscription as Pending allows you to leave a subscription in a pending state during the incomplete subscription creation process. For example, enabling this function allows you to create a subscription before triggering the fulfillment process to collect technical resources for your contract. When the contract is complete, you can remove the pending status and update the start date of the subscription.
Enabling the Configurable switch allows you to configure your product once the subscription is created. When setting up a new subscription, configurable products will display an additional tab Product Configuration.
This tab allows you to add attributes and their subscription item values. These attributes and values are passed to Price Calculation and considered in the price calculation logic. As entered under the Attribute field above, the term refurbished indicates that the customer accepts a refurbished printer in the subscription service. This scenario requires the use of Price Calculation. Price calculation will use this information to result in a lower monthly rate. We’ll examine the integration of Price Calculation later in this course. For now, just remember that these parameters allow you to influence the calculation of prices for your product.
Summary
Now that we’ve created a new product based on an existing rate plan template, let’s create a new rate plan for a product in the next lesson.