ARR Plan
ARR Plan compares a company’s ARR figures to projections. The "Original Plan" is the plan as agreed by the company and the board at the beginning of the financial year. The plan can be updated mid-year with the new plan listed in subsequent rows (depending on when the new plan was made), but performance is always compared to the original plan. Plan figures are added directly into SaaSGrid.
SaaSGrid supports plans for the following metrics:
- Net New ARR
- Expansion ARR
- New Sales + Expansion ARR
- New Sales ARR
- Gross Renewals
- Net Renewals
- Bookings (ARR)
- Total ARR
For more mature companies, annual planning is an important practice for determining how resources will be allocated for the upcoming year. Finance builds models that show how investment in product, sales, and marketing will lead to ARR growth. It’s very important the team hits the ARR targets, otherwise unit economics and burn will be far worse than the model projects. If the team starts to miss plan figures, the operating plan needs to be adjusted and expenses dialed back.