Is this a pricing problem or am I missing the talk track?

I sell a SaaS product that that's priced per user (minimum 12 month contract), almost always used by the whole workforce and mainly purchased by companies with 100-2000 employees.

With our pricing model, customers start paying for all users from day 1 even though there's typically no more than 5-10 people that need access throughout deployment, which roughly takes 2-4 months.

A prospect today was shocked when I told them they'd have to start paying for all users although the vast majority wouldn't access for the first few months at the very least.

I didn't really know what to answer since strangely this hasn't come up that much as an objection in the past but I totally get where they're coming from.

What is your experience with situations like this and how would you deal with it?