Cloud Monthly Recurring Revenue (MRR) Calculator is now available!

By: Cloud Offers


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Cloud Monthly Recurring Revenue (MRR) Calculator is now available!

Use the Cloud MRR Calculator to arrive at a revenue model for developing your cloud managed services business

Details

A cloud solution provider’s business is complex. We all know it takes an effort to build the right business model and execute it well. We all think that way. That said, technology decision makers think quite differently when it comes to revenue. 
For example, technology business decision makers may think in the following way:

  • “We need to grow our company by 10%. Can we do it by selling cloud services?” 

  • “We just got a cloud request. How should we price the proposal to be profitable?”

 It does not have to be so complex. But what if we flip your thinking with an end goal in mind? Let’s say, you want to make $250,000 revenue per year selling cloud solutions and services. The best way for you to do this is to work backwards to figure out what works the best for you. We know. This is hard. We got you covered.

The Cloud MRR Calculator is the solution:

We designed the Cloud MRR Calculator to help estimate your cloud revenues by playing with different levers to sell your cloud services.

Here is how you need to use the Cloud MRR Calculator to define your cloud opportunity:

  • Define the cloud solution that you want to sell to your customer.

  • Identify proof of concept (POC) pricing for your cloud services. It can be $5,000, $10,000, $20,000 or more. Keep it below $25,000 for any POC. This is a fixed price.

  • Identify cloud vendor products you will stitch together to estimate the monthly investment the customer needs to make to access the cloud solutions. Then, identify your margins. Hint: Work with your distributor or directly with your cloud vendor to secure the commission structure for reselling their cloud products.

  • Define your managed services. The best way to come up with a number is to identify the number of resources you may need and what their going rate in the market is. Put it all together. For example: Suppose we are offering a cloud app development service for a medium sized company where we have sold $10,000 for a proof of concept. To price our managed services, we would price for 1.5 people every month plus any tools subscriptions that may be needed. That comes to around $5,500 per month. We would recommend a ten-month contract for the customer.

Once you have all the numbers including the number of customers, you can identify the total cloud opportunity for your business. Keep playing with the Cloud MRR Calculator until you are satisfied. 

Also, please send feedback and ideas to improve this solution!

This product is offered by

Cloud Offers

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