topic Re: Deal: Recalc Amount, Annual Contract Value, Annual Recurring Revenue on Adjustment in CRM

Deal: Recalc Amount, Annual Contract Value, Annual Recurring Revenue on Adjustment

pbmartin — Sun, 04 Jul 2021 11:35:53 GMT

We use line items to calculate simple sales with Monthly Recurring Revenue. When we combine more than one service we may charge less because of overlapping items. We thought we could adjust the Monthly Recurring Revenue and see changes in the total properties.

Question: When we adjust the Monthly Recurring Revenue how do we see updates in Amount, Annual Contract Value and Annual Recurring Revenue?

Subscriptions: Sales Hub Enterprise and Marketing Professional

Re: Deal: Recalc Amount, Annual Contract Value, Annual Recurring Revenue on Adjustment

bsheen — Fri, 09 Jul 2021 15:56:06 GMT

Hi @pbmartin,

Thanks for reaching out to the Community!

The MRR and ARR properties are calculated by HubSpot and cannot be adjusted directly. They do not take into account or adjust the value in the Amount property. However, modifying the line items and term length on a Deal would affect both MRR and ARR.

Annual recurring revenue (ARR): the total amount of revenue earned annually for this deal. This is calculated based on the term length and values of the recurring line items associated to the deal. If there is no term length, HubSpot assumes a term of 12 months. It does not take into account the value in the Amount property.

Monthly recurring revenue (MRR): the recurring revenue each month for this deal. This is calculated using the values and term length of the recurring line items associated to the deal (i.e., total value divided by the number of months in the term length). It does not take into account the value in the Amount property.
-see Everything You Need to Know About Monthly Recurring Revenue (MRR)

The Annual contract value is also a calculated property displaying the value of the deal over a 12-month period in the deal's currency. This would be calculated independently but would have relation to MRR and ARR. For example, if a customer signs a 5-year contract for $50,000, then the ACV would be $10,000. -see ACV: What It Means & How to Calculate It

I hope this helps! Happy to discuss this further here!

Best,

Brendan

Re: Deal: Recalc Amount, Annual Contract Value, Annual Recurring Revenue on Adjustment

JustinWigg — Mon, 20 Dec 2021 23:17:56 GMT

Why can I not get ACV on a quote? It seems like it will only display a total that doesn't take in to account the appropriate recurring multiples for monthly/quarterly billed items.