Value billing

Value billing is a charge to a customer based on the value received, rather than the cost of the services provided. This type of billing is most common in situations where the value provided is unique and essential to the customer. For example, an investment banker or criminal defense attorney can issue value billings because the value provided is so great.

In areas where there is a competitive market for services, it is not possible for a supplier to enforce value billing, since similar services can be provided by competitors that are cost-based, and therefore much lower.

Related Courses

Revenue Management