Price × Volume and Customers × ARPU

Methods and settings

Set up two separate assumptions

Add or open a revenue Business Line, then choose Price × Volume or Customers × ARPU for the forecast period. Enter the two components rather than the final revenue amount. This preserves the question of whether a revenue change comes from price, activity or both.

Use the shared unit rules. Price is currency per unit; volume is a quantity. Customer count is a count and ARPU is explicitly annual. Do not type a quarterly ARPU into an annual ARPU field unless you first convert it to the annual basis.

Understand the period basis

Price × Volume uses the selected period quantity. Customers × ARPU treats ARPU as an annual flow and scales the result by the period’s year fraction. Thus the same annual ARPU does not generate four full annual revenue amounts when viewed quarterly. Fiscal and day-count boundaries can make a shorter period differ slightly from a simple one-twelfth or one-quarter approximation.

Changing the visible period view alone does not reinterpret the saved components. The active source controls the inputs, and other views derive their outputs. A deliberate source replacement initializes the new periods from the existing economics.

Link only the intended component

For a component, choose Linked value and an eligible model reference when the same assumption should drive more than one calculation. The relationship remains live. A referenced quantity changing elsewhere then updates this line; a copied number would not. References that create a circular dependency are unavailable.

A COGS unit-cost line can use the revenue volume as its quantity source. Keep selling price and unit cost separate: they answer different questions. When switching a component between direct input and linked value, the product retains its method-specific setup; inspect the active source before relying on an old stored number.

Compare a price change with a volume change

Synthetic base: 100 units × 50 = 5,000 Revenue, with linked COGS of 100 × 30 = 3,000. A price of 55 at unchanged quantity gives Revenue 5,500 and Gross Profit 2,500. A quantity of 110 at unchanged price gives Revenue 5,500, COGS 3,300 and Gross Profit 2,200. The same revenue increase has a different cost effect.

Use Sensitivity to compare supported price/volume assumptions without writing each case into the model. Customers × ARPU does not by itself add churn cohorts, contract billing, deferred revenue, subscription retention or collection timing. Those behaviors must be represented by supported separate assumptions, where available.