The subscription business model is a business model where a customer pays a subscription price to have access to a product or service. Supscriptions are typically paid by a unit, e.g. by user, server, ..
Learn how to
- Create a Subscription Revenue Stream,
- Enter assumptions for your first Customer Type (Customer Contract) who is buying your subscriptions plans (e.g. your Startup Plan),
- Save your assumptions
Create a Subscription Revenue Stream by clicking the <+Add Revenue Stream> button and selecting the revenue model "Subscriptions (Customer Contract)" from the dropdown Revenue Stream Type. Lean-Case creates the Revenue Stream with a Subscription Revenue Template for the first Customer Type. Enter the description for your Subscription Revenue Stream in the Widget Header (e.g. Software Subscription).
Enter Assumptions for your first Customer Type
Enter assumptions for the Customer Type in the Widget Template:
- Customer Type Description (e.g. Startup Plan)
- Billing Frequency at which the customer's invoice is created (Monthly, Quarterly or Yearly)
- Payment Terms to know the time of invoice payment (cash-flow) (how many days after invoice creation customer must pay)
- Number of Customers at beginning to enter the number of customers which already exist at the beginning of the time period
- Monthly Average Revenue which a customer generates (e.g. a Startup Plan customer generates revenues of €100 per Month)
- Price Change upon Renewal to define the increase or decrease of price upon contract renewal (e.g. if a customer is billed Monthly his contract is renewing on a monthly basis - if a customer is billed Quartely his contract is renewing on a quartely basis and the average revenue is increased)
Save assumptions by clicking the <Save Stream> button.
By default, Lean-Case calculates revenues for one customer which is billed on a monthly basis. Let's assume the Average Monthly Revenue is € 100, then this results in monthly subscription revenues of $100.
Data Groups provide maximum flexibility for capturing assumptions with varying values over time.
- a Data Series Group combines an input field with a Table Icon to enter varying values for a data series.
- a Data Edit Group combines three input fields (one of which being a Data Serie Group) in one column with an Edit-Mode Switch for automatic and manual editing.
Follow the links below to dive into more detail on how to create a Service Revenue Stream:
- Add a Subscription Revenue Stream
- Edit inputs with varying values using flexible editing with Data Groups
- Define the Customer Mix by adding different Customer Types buying your services
- Define how many new customers you acquire by linking a Forecast Model
- Define how many customers renew their relation by defining Customer Churn (by default, Customer Churn for a Service Revenue Stream is set to 100%, i.e. no customers renew their relation)
- Add Revenue Related Cost linked to getting, keeping and growing customers, in particular