How To Calculate Gross Dollar Retention in Sage Intacct | Arithmix

Learn how to calculate gross dollar retention in Sage Intacct with our step-by-step guide. Discover the key metrics and formulas to track your company's revenue growth and customer retention. Boost your financial management skills and optimize your business performance today.

Calculating gross dollar retention is an important metric for any business looking to understand its revenue growth. It measures the amount of revenue retained from existing customers over a given period of time, and is a key indicator of customer loyalty and satisfaction. In this article, we'll explore what gross dollar retention is, when it's valuable to calculate, and how to calculate it using Sage Intacct.

What Is Gross Dollar Retention?

Gross dollar retention is a measure of how much revenue a business retains from its existing customers over a given period of time. It takes into account both the revenue from customers who renew their subscriptions or contracts, as well as any additional revenue generated from those customers through upsells or cross-sells. Essentially, it measures the effectiveness of a company's customer retention and expansion efforts.

Gross dollar retention is typically expressed as a percentage, calculated by dividing the total revenue from existing customers at the end of a period by the total revenue from those same customers at the beginning of the period. For example, if a company had \$1 million in revenue from existing customers at the beginning of the year, and \$1.2 million at the end of the year, its gross dollar retention rate would be 120%.

When Is It Valuable To Calculate Gross Dollar Retention?

Gross dollar retention is a valuable metric for any business that relies on recurring revenue from customers, such as subscription-based businesses or those with long-term contracts. By measuring how much revenue is retained from existing customers, businesses can gain insights into customer loyalty and satisfaction, as well as the effectiveness of their customer retention and expansion efforts.

Calculating gross dollar retention can also help businesses identify areas for improvement. For example, if a company's gross dollar retention rate is lower than expected, it may indicate that customers are not satisfied with the product or service, or that the company's customer retention and expansion efforts are not effective. By identifying these issues, businesses can take steps to address them and improve their revenue growth.

How To Calculate Gross Dollar Retention Using Sage Intacct

Sage Intacct is a cloud-based financial management software that can help businesses track and analyze their financial data, including gross dollar retention. To calculate gross dollar retention using Sage Intacct, follow these steps:

1. Run a report that shows the total revenue from existing customers at the beginning of the period and the end of the period.
2. Calculate the difference between the two totals to determine the amount of revenue retained from existing customers.
3. Divide the amount of revenue retained by the total revenue from existing customers at the beginning of the period, and multiply by 100 to get the gross dollar retention rate.

For example, if a company had \$1 million in revenue from existing customers at the beginning of the year, and \$1.2 million at the end of the year, the amount of revenue retained would be \$200,000. Dividing \$200,000 by \$1 million and multiplying by 100 would give a gross dollar retention rate of 120%.

By regularly tracking and analyzing gross dollar retention using Sage Intacct, businesses can gain valuable insights into their revenue growth and customer loyalty, and make data-driven decisions to improve their financial performance.

How Do You Calculate Gross Dollar Retention in Sage Intacct

Sage Intacct itself isn’t naturally geared towards letting you calculate complex metrics like Gross Dollar Retention. As an alternative, teams typically use products like Arithmix to import data from Sage Intacct 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 Sage Intacct, combine it with data from other systems, and create calculations like Gross Dollar Retention.

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.