There are a number of ways that elearning companies might charge for elearning and understanding the different elearning pricing models used is key to comparing different offerings. Since we are predominantly a bespoke elearning company, we’ll focus on bespoke elearning pricing, rather than charging models for off-the-shelf elearning. There are three main charging models, as follows:
1. License, Hosting and Renewal Fees
Although this is more common for off-the-shelf elearning, many bespoke elearning companies still charge license, hosting and renewal fees. There are some advantages to this elearning pricing model, primarily that you pay a regular amount on a monthly or annual basis, and you avoid the need to pay a larger sum of money compared to the development fee (below). However, this option can be harder to budget for, and your costs will increase if you need to add more users to the training. And it will usually work out more expensive over a two or three year period than paying a flat development fee.
2. Development Fee (Flat charge)
Some companies charge a one-off development fee for elearning. If your elearning supplier uses this elearning pricing model, you should ensure that your return on investment is realised soon after the elearning has gone live. Also, watch out for hidden charges: we’ve heard from clients who have experienced being asked to pay for things they would expect to be included in the fee, such as minor amendments and transferring the elearning output files to the LMS.
3. Daily/Hourly Rate for Development
A surprisingly popular method is charging a daily or hourly rate for elearning development. This is surprising because there is usually no jeopardy for the elearning development company: if they deliver on time, the client is happy, but if development takes longer than expected, the elearning company receives more billing as a result. This model can work for very short or very occasional pieces of work, but we would not recommend it for longer, more complex projects.
Our Preferred Elearning Pricing Model
Our favourite elearning pricing model is to charge a flat, fixed-price development fee for elearning courses. Once we understand our clients’ requirements, we draw up a statement of works which makes the scope of the elearning development clear. The elearning pricing is usually determined by a range of factors, including elearning length, complexity, range of features, and how much content writing is required.
Whilst we naturally have to be careful to avoid too much scope creep impacting our ability to deliver to agreed timescales, we work very hard to ensure that everything our clients want and need for their elearning to be a success is delivered within the agreed price. Occasionally, that means we do some extra work without charge, but we think it’s worth it to ensure we have happy clients!
You may wonder how much elearning costs. Each project has its own unique variables and the truth is that one elearning course could cost anything from £500 – 15,000 depending on what is required! If you’re curious about how much it might cost to develop a particular course, why not drop me an email? firstname.lastname@example.org – I’ll be glad to help out!