We will lose 10 dollars due to the departure of subscribers,

ripon1122

This is the cost of goods sold (COGS), for which we will spend, say, around $20. Another $10 will be spent on business administration. These are a wide range of tasks related to accounting, legal support and the cost of renting office space. Don't forget about research and development (R&D): these recurring costs are largely made up of the cost of engineers' salaries.

In our example, we will budget $20 of annual income for this.20 dollars will be spent on maintaining the quality of service, another 10 dollars will be spent on administration, and 20 dollars will be spent on innovations, which must first be developed and then implemented competently. Therefore, of the originally Country Email List planned $100, the income was only $40. That is, 40% of income. They can be spent on business development. The amount of income is directly related to recurring costs: the higher the latter, the lower the former. By calculating the amount of expected revenue, the company will be able to understand how much money is left for development.





The subscription business model allows you to calculate prospects. A business that doesn't use subscriptions will have a much less accurate forecast because it doesn't know the annual number of customers and the amount customers will spend on transactions. Growth efficiency ratio Image source The profits of the business (in our example it is $40) can be distributed among the owners of the company in the form of dividends. Or you can invest them in the development of the commercial department and marketing campaigns,