How To Calculate Cost of Annual Recurring Revenue in Deltek Vision | Arithmix

Calculating the cost of annual recurring revenue (ARR) is an important aspect of any business. It helps you understand the amount of money you are making from your recurring revenue streams and the costs associated with maintaining them. ARR is the amount of revenue that a company expects to receive from its customers on an annual basis. It is an essential metric for subscription-based businesses, as it helps them understand the value of their customer base and the potential for growth.

What Is Cost of Annual Recurring Revenue?

The cost of annual recurring revenue is the amount of money a company spends to maintain its recurring revenue streams. This includes the cost of acquiring new customers, the cost of retaining existing customers, and the cost of providing customer support. The cost of ARR is an essential metric for any business that relies on recurring revenue streams, as it helps them understand the profitability of their business model.

Calculating the cost of ARR involves taking into account all the costs associated with maintaining your recurring revenue streams. This includes the cost of marketing and advertising, the cost of customer support, the cost of product development, and the cost of sales. By subtracting these costs from your total ARR, you can determine your net ARR, which is the amount of money you are making from your recurring revenue streams after all costs have been accounted for.

When Is It Valuable To Calculate Cost of Annual Recurring Revenue?

Calculating the cost of annual recurring revenue is valuable for any business that relies on recurring revenue streams. It helps you understand the profitability of your business model and the potential for growth. By knowing your net ARR, you can make informed decisions about how to invest in your business and where to focus your efforts.

For example, if your net ARR is low, you may need to invest more in marketing and advertising to acquire new customers. Alternatively, if your net ARR is high, you may want to focus on retaining your existing customers and providing them with excellent customer support. By understanding the cost of your ARR, you can make informed decisions about how to grow your business and increase your profitability.

In conclusion, calculating the cost of annual recurring revenue is an essential metric for any business that relies on recurring revenue streams. It helps you understand the profitability of your business model and the potential for growth. By taking into account all the costs associated with maintaining your recurring revenue streams, you can determine your net ARR and make informed decisions about how to invest in your business.

How Do You Calculate Cost of Annual Recurring Revenue in Deltek Vision

Deltek Vision itself isn’t naturally geared towards letting you calculate complex metrics like Cost of Annual Recurring Revenue. As an alternative, teams typically use products like Arithmix to import data from Deltek Vision and build out dashboards.

What is Arithmix?

Arithmix is the next generation spreadsheet - a collaborative, web-based platform for working with numbers that’s powerful yet easy to use. With Arithmix you can import data from systems like Deltek Vision, combine it with data from other systems, and create calculations like Cost of Annual Recurring Revenue.

In Arithmix, data is organized into Tables and referenced by name, not by cell location like a spreadsheet, simplifying calculation creation. Data and calculations can be shared with others and re-used like building blocks, vastly streamlining analysis, model building, and reporting in a highly scalable and easy to maintain platform. Data can be edited, categorized (by dimensions) and freely pivoted. Calculations are automatically copied across a dimension - eliminating copy and paste of formulas.

Arithmix is fully collaborative, giving your entire team access to your numbers and the ability to work together seamlessly.

Calculating Cost of Annual Recurring Revenue in Arithmix

Calculating metrics like Cost of Annual Recurring Revenue is simple in Arithmix. Once you've created your free account, you’ll be able to import your Deltek Vision data, and use it to create natural language formulas for metrics like Cost of Annual Recurring Revenue.

Arithmix is designed to give you the power to build any calculations you want on top of your Deltek Vision data, while also being easy to use and collaborate on. You can share your dashboards with users inside and outside of your organisation, making it easy to empower your whole team.