Companies working with subscriptions often measure their revenue by Annual (ARR) or Monthly (MRR). With this sales model activated it's a whole lot easier to see the revenue value of opportunities, orders, and your customers. You can also set sales targets for both subscriptions and one-off products with this model.
ARR or MRR?
If your company measures revenue from subscriptions you probably know if it's Monthly or Annual revenue you want showing inside Upsales. What this option does is basically calculate the subscription value either by year or by month and then display that value inside opportunities, orders, companies, and contacts. So instead of just the one-time order value being display, you can also see the MRR/ARR value of for example an opportunity.
Use churn and contractions when calculating ARR/MRR?
Would you like the value of lost customers and decreases in ARR/MRR to be included in the calculation?
What is churn?
A sales definition of lost customers.
What are contractions?
Contractions are decreases in value for subscriptions. If a customer used to buy for $100 yearly and then downgrades to only pay $80 a year, this is a $20 contraction.
Settings targets for subscriptions & one-off products
The main metric that most subscription-based companies use is either ARR or MRR, and that value comes from subscriptions. If you want your sales teams to focus on selling subscriptions, set this target.
Subscription and one-off targets only appear here after you've chosen a recurring revenue model Like this, Choosing the contribution margin sales model will instead show you 'Contribution target' as an option.
- CRM > Targets > Subscription targets
- CRM > Targets > One off targets
- Make sure you have the permission of Administrator to access these pages
Subscription products are billed at a recurring interval and use the Subscription feature in Upsales. This lets you automate your revenue stream.
Basically, products that have a one-time cost for your customers and are not billed recurringly.
Viewing a company's ARR and Cashflow
Enter a company page in Upsales and click the Sales tab (only visible if there are any historical sales). A new toggle option between ARR/MRR and Cash flow will not be present.
This page lets you view the historical changes in revenue coming from subscriptions.
Cash flow option
This one shows you all historical sales by orders and divided by year. It's basically how the company sales tab looks by default (with the Order value sales model active).
Switching between viewing ARR or One-off values in the sales board
With the Recurring Revenue sales model you are now able to switch between showing subscription values or one-off values on the sales board.
- Go to your Sales board.
- In the page header, you'll now find a toggle between ARR (or MRR depending on your choice in Step 1) and one-off –
- Switch sales board card values with just one click.
Displaying targets in the Upsales main header
On the top-right of your screen you can also see and click a progress bar:
This gives you lots of useful data on growth, targets, sales, pipelines, and one-offs: