This one has me dizzy.
A simple example is a ramping contract where Year 1 has a qty of 100, year 2 has a qty of 200 and year 3 has a qty of 300. From a forecasting lens I need to represent the ARR of this opportunity, and I am ok with using only the first 12 months and generally ARR has been MRR *12. I have created two separate quotes modeling this example and run into the same problem
Quote #1: Uses separate quote line groups to group the subscriptions for year 1 together, so in this example I have 3 groups, each with a different subtotal representing the annual increase in qty. While mathematically accurate, each line has it's own MRR and therefore the resulting ARR calculation is roughly 3x the actual first year ARR since it is also including the MRR from Years 2 and 3 in the ARR calculation.
Quote #2: Use MDQ, which basically has the same problem
I believe I just need a way to limit the ARR calculation to the subscriptions that would occur in the first 12 months?? Anyone know how to do this?? ARR is presently done with a price rule and a summary variable.
The BONUS QUESTION... This specific scenario gets more complicated because the customer is requesting balloon period where the qty increases ONLY during the summer months. So I need a way to handle adding the qty increase during specific months. I solved this sufficiently using the model explained above in Quote #1 where I added another quote line representing the short term qty increases, and it worked fine. I am wondering if there is a way to address when using the MDQ model in Quote #2? And these short-term increases that occur within the first 12 months would need to be included in the forecasted first year ARR. Any Idea?
Hi Adam. If you're using MDQ, you can filter your ARR rollup(s) based on the quote lines' Segment Index. So if you just want your Year 1 ARR, you can roll up all quote lines that have a Segment Index of NULL or 1. (The NULL inclusion means that it will also count non-MDQ quote lines.)