Subscriptions with ARR Field

[DCrinnion1]

Hi All,

Have tried creating Subscriptions that push the ARR for that Subscription in to the ARR field on the Deal Object.

For Multi Year Deals with discount I have realised creating 2 subscriptions (1 for the discount and 1 for the rest) is maybe the best move for me as I am also able to set the start and end dates for when they run out, however there are 2 areas that have stopped me in my tracks.

Firstly, I am looking at pushing the Subscription of the first contract straight in to ARR even if the start date is in the future (reason this is an issue is because I created a RollUp ARR field that took the ARR from Subscription Object and the condition criteria is Active to get away from the other subscription in the future). Therefore I am looking at a way I can seperate the first from the other subscription so that the first subscription goes in to ARR and the second subscription goes in to Scheduled ARR (Also RollUp with Criteria as Scheduled).

The other issue is the fact we don't invoice/collect payments inside of Hubspot therefore after a day (or whenever I set the NET payment) it goes to Unpaid and offsets my subscription ARR.

Apologies for all of this, I am struggling quite a lot with building out an in-Hubspot recurring revenue recorder.

[Jonno_Price]

Hi @DCrinnion1 

Have you tried using Product/Line items to represent the subscription and which are added to the deal? HubSpot has a default ARR property that updates automatically but it is based on line items associated to the deal. You can also add start and end dates on the line item.

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.

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).

[DCrinnion1]

Hi Jonno!

Thank you for this! I am not entirely sure how I would do this. I thought that Annual Recurring Revenue was a field set only by Hubspot and even with Start and End dates being created at Line item level, I wasn't aware of how to get these custom fields to dictate when the ARR should be shown?

[Jonno_Price · Accepted solution]

Hi @DCrinnion1 

You are right in that ARR is only set by HubSpot and it is calculated as far as i know based on amounts and term length / billing frequency etc. as captured on line items associated to the deal. So if you were able to create a line item with the correct start and end dates, including adding additional line items for multi-year subscriptions, then theoretically ARR/MRR should update accordingly. 

Exactly how you would get this to work alongside the new "Subscriptions" module that I believe you are using in the eCommerce hub I'm not sure. But I know that with line items, you could for example have a period with start and end dates that are discounted - e.g. for 1 year, followed by another line item that starts at the completion of the discounted period in the full amount, etc.

Getting ARR/MRR reporting accurate can be notoriously tricky, especially if you also need to manage upgrades, downgrades, churn etc. Sometimes Operations Hub Pro/Ent is required with custom coded workflows, custom objects etc. 

[BérangèreL]

Hi @DCrinnion1, I hope that you are well!

Great question, thanks for asking the Community!

First, I'd like to share this article "Track recurring revenue in HubSpot" that might be of interest to you.

Also, here are similar threads that might help you:

- Managing a scaling up multi-year opportunity
- Best Practice for Tracking Recurring Revenue from different Deals
- Multi-year deal with price escalation
- Calculating total value of deals with multi-year products charged annually

Let's consult our Top Experts: Hi @Ian_Matt, @Phil_Vallender and @Jonno_Price do you have suggestions to help @DCrinnion1, please?

Thanks so much and have a great day!

Best,
Bérangère

[DCrinnion1]

Hey!

Thank you very much for this. On the first link regarding the recurring revenue beta, we have looked at this however the versatility of it is a bit of a barrier for us, for two reasons. Firstly there is no ARR field (although I am aware we could create a custom one) it doesnt go in to the same reporting function. Also for multi year deals with discount this doesn't provide a good fit, as in order to change the price we need to make an inactive reason and there is no reason for ramp up pricing, also we would have to create a new deal for the new pricing which is something the sales team don't want as it will affect conversion for New Business deals. Thank you very much for this insight though!