1. What Is Monthly Recurring Revenue?

Monthly Recurring Revenue (MRR) is a key metric for subscription-based businesses that measures the predictable revenue a company can expect to receive every month. It's calculated by multiplying the number of subscribers by the average revenue per user.

2. How Does The Calculator Work?

The calculator uses the MRR formula:

Where:

• \( Subscribers \) — Total number of paying subscribers
• \( Fee \) — Monthly subscription fee per subscriber (in RM)

Explanation: This simple multiplication gives you the total monthly recurring revenue from your subscriber base.

3. Importance Of MRR Calculation

Details: MRR is crucial for subscription businesses as it helps in forecasting revenue, measuring growth, evaluating business health, and making informed decisions about pricing, marketing, and resource allocation.

4. Using The Calculator

Tips: Enter the total number of subscribers and the monthly subscription fee in Malaysian Ringgit (RM). Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What's the difference between MRR and ARR?
A: MRR is Monthly Recurring Revenue while ARR (Annual Recurring Revenue) is simply MRR multiplied by 12, giving you the yearly recurring revenue.

Q2: Should I include one-time payments in MRR?
A: No, MRR should only include recurring subscription revenue. One-time payments should be tracked separately.

Q3: How often should I calculate MRR?
A: Most businesses calculate MRR monthly to track growth trends and monitor business performance.

Q4: What factors can affect MRR?
A: MRR can be affected by new subscriptions, cancellations, upgrades, downgrades, and churn rate.

Q5: Is MRR relevant for all types of businesses?
A: MRR is most relevant for subscription-based businesses (SaaS, streaming services, membership sites). Traditional product-based businesses use different revenue metrics.