{"id":3526,"date":"2022-08-17T15:03:15","date_gmt":"2022-08-17T15:03:15","guid":{"rendered":"https:\/\/www.subbly.co\/blog\/?p=3526"},"modified":"2023-05-12T14:24:24","modified_gmt":"2023-05-12T14:24:24","slug":"a-guide-to-revenue-forecasting-for-subscription-businesses","status":"publish","type":"post","link":"https:\/\/www.subbly.co\/blog\/a-guide-to-revenue-forecasting-for-subscription-businesses\/","title":{"rendered":"A guide to revenue forecasting for subscription businesses"},"content":{"rendered":"

What is subscription revenue?<\/b><\/h2>\n

Whether you\u2019re in the early stages of launching your subscription based business models or integrating a subscription service as part of your existing ecommerce business, one of your top priorities should be subscription revenue forecasting. Forecasting your subscription revenue is crucial to the success of your subscription business, as well as its forward planning and strategy.<\/span><\/p>\n

Companies whose model is centered around <\/span>subscription commerce<\/span><\/a>, or subscription businesses, are focused primarily on retaining customers as opposed to one-off purchases of singular products. This facilitates the creation of streams of recurring subscription revenue.\u00a0<\/span><\/p>\n

\ud83e\udd14 How is subscription revenue generated?<\/div>
Subscription revenue is generated when customers agree to purchase a product or service on an ongoing basis, and they are charged a certain amount on an agreed frequency. This allows the business to achieve a more consistent, predictable revenue. <\/div><\/div>\n

The next step of this is subscription revenue recognition, which occurs once the money has been received from customers and the service has been delivered. Many businesses consider this recognized revenue their <\/span>actual<\/span><\/i> revenue.<\/span><\/p>\n

There are a few different<\/span> pricing models<\/span><\/a> and subscription revenue models you can consider for your subscription business:<\/span><\/p>\n