Revenue Streams in Business

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Questions and Answers

What is the characteristic of revenue mentioned in the context of hiring?

It is based on the client's invoice

It is recurring in nature

It is based on the replacement period

It is of one-time nature (correct)

What is the main reason for considering the replacement period in hiring?

To calculate the EAPM

To ensure timely invoicing to the client (correct)

To decide the recruitment strategy

To determine the MRR

What is included in the calculation of EAPM?

Only OJT learning related revenue

All the recurring related revenues (correct)

Only DWS revenue

Only the revenue from hiring

What happens when a sourced person leaves during the replacement period?

No invoice is raised to the client Signup and view all the answers

What is the impact of bundling revenue on MRR?

It increases the MRR Signup and view all the answers

What is the purpose of considering the incremental revenue in the learning related program?

To apply the same logic as in MRR Signup and view all the answers

Why are one-time revenues kept separate from other revenue components?

To prevent skewing of the EAPM number Signup and view all the answers

What is the main component of net revenue?

All revenue components Signup and view all the answers

What happens when one-time revenue is high in a particular month?

EAPM gets skewed Signup and view all the answers

What is the purpose of separating one-time revenues from other revenue components?

To reduce the impact on EAPM Signup and view all the answers

What is EAPM affected by?

Both one-time and recurring revenue Signup and view all the answers

What is the primary purpose of MRR in revenue management?

To measure the net new addition to revenue or billing in a month Signup and view all the answers

What is the role of finance in the process flow of DA world?

Involved in meetings, proposals, input and billing, invoicing and collection Signup and view all the answers

Where is the input and billing process linked to?

Funding Signup and view all the answers

What is the purpose of discussing the entire life cycle of activities in DA world?

To introduce general terminologies used in the industry Signup and view all the answers

What is an example of an MRR in account management?

Increasing billing from 100 to 120 trainees in a month Signup and view all the answers

What is the process flow of DA world involved in?

Meetings, proposals, input and billing, invoicing and collection Signup and view all the answers

Study Notes

Aspects of DA World from a Finance Perspective

Meetings and proposals involve Zoho and are linked to finance
Agreements, input, and billing are linked to funding and involve finance
Invoicing and collection involve finance and MIS

General Terminologies

MRR (Monthly Recurring Revenue) is the net new addition of revenue or billing generated in a month
Examples of MRR include:
- New billing or sign-ups from a hunting team
- Incremental revenue from an account management (e.g., increasing from 100 to 120 trainees)
MRR logic applies to learning-related program revenue and incremental learning revenue

Revenue Components

Recurring revenue components:
- OJT learning-related revenue
- DWS
One-time revenue components:
- Hiring revenue (clubbed and given as a bundled out)
Revenue components excluded from EAPM calculations:
- One-time revenues (to avoid skewing or diluting the EAPM number)

EAPM and Net Revenue Calculations

EAPM calculation considers only recurring revenue components
Net revenue calculation includes:
- Recurring revenue components
- One-time revenue components
- DBT revenue components
- Insurance revenue components

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Description

Understand the concepts of MRR, incremental revenue, and bundled revenue in business. Learn how to calculate and differentiate between one-time and recurring revenue streams. Apply this knowledge to real-world scenarios like hiring and learning programs.