Tiered Pricing

Tiered pricing charges different per-unit rates across bands of quantity or usage, so what a customer pays per unit changes as they scale. It's a common way to price seats, API calls, or any metered resource — the first units cost one rate, later units another.

Graduated vs volume tiers

Stripe supports two tier modes, and they produce different totals for the same quantity:

• Graduated — each tier's rate applies only to the units that fall inside it. The customer pays the first-tier rate for the first band, the second-tier rate for the next band, and so on.
• Volume — one rate, chosen by the total quantity, applies to every unit. Cross into a higher tier and the whole quantity is priced at that tier's rate.

Example

Suppose seats are priced $10 each for the first 10, then $8 each above that.

• Graduated, 15 seats: (10 × $10) + (5 × $8) = `$140`.
• Volume, 15 seats: the total lands in the second band, so all 15 × $8 = `$120`.

Same inputs, different bill — which is why the mode matters when you model revenue.

Why it matters

Tiered pricing rewards customers for growing with you while protecting your margins at low volume. It pairs naturally with usage-based billing, where a metered quantity is rated through the tiers each period, and with seat-based pricing, where per-seat cost drops as teams expand. In Stripe, tiers live on the Price object and are applied automatically when an invoice item is generated, so the right rate is computed without manual work.