On Wednesday we announced new and refreshed subscription plans. We made these changes to align value globally for new features such as Payroll in the US, varying storage limits for our Files storage feature and in preparation for new services we have planned.
We don’t change pricing often, and around 90 per cent of our customers will have a price decrease or only a $1 or £1 increase. For some of our Australian customers there is a more substantial rise, where we’ve changed our approach of charging by number of payroll employees to be more granular. We’ve therefore raised prices where there are higher volumes of Payroll employees, inclusive of automated super payments, along with higher storage limits.
Where we can help, and are taking immediate action, is with a question that many Australian partners and customers have had about the incoming “Standard” plan only having 1 payroll employee. We know we’ve slipped up and I won’t bore you with the convoluted history of discussion that led to us putting that out there.
So we’re confirming that for the new Standard plan, we’ll make the number of payroll employees on that plan 5 not 1.
We are very grateful for the comments that have led us to reconsider this, and appreciate that for many small businesses with a very low number of employees that have been using Xero with Payroll in Australia it makes sense to keep the transition simple and provide this option.
Another concern that was raised was around how we’ve listed the new plans as having 1000 invoices and 1000 bank reconciliation lines. This was simply a rewording of what we currently have written as “hundreds” and remains a soft limit that we would only enforce if someone’s use was excessive and causing performance issues for others. However, some took it to mean it was now a hard limit so we’ve made that clearer on the pricing pages. We are always working to increase the limits and have a bunch of projects on to raise this in the future. But we believe we cover most small businesses now.
We’ve also heard loud and clear the concerns about the amount of advance notice we’ve given. Unfortunately with the work done and ongoing behind the scenes we are not in a position to change that at this point. Please be assured we do take everything we are hearing to heart.
We are grateful for the many comments in support of what we are trying to do and appreciate the community conversation between those with many points of view. It pains us when we hear suggestions of typical corporate behaviour and it lifts our hearts when we are reminded of how we aren’t like that. We’ll strive to keep Xero a unique software company striking its own path and look forward to rebuilding any love lost along the way for the tougher decisions we make.
At Xero our focus is not on price, it’s on the value we’re providing. We aim to be very competitive but we also really love to deliver great features that make small business more productive and accountants and bookkeepers work more fulfilling. Just a reminder of the path we’re on feature-wise and that you are on with us. Online accounting is a true revolution for small business and we’re just beginning.
If you have any questions about the plan changes in Australia join me on one of our final two webinars this week where I will take you through all the pricing announcements as well as the decision to lift Standard from 1 to 5 payroll employees in Australia.