![]() ![]() In the case of the example 3-year contract above, your billings are the annual amount you invoiced the customer-$10,000 each year. ![]() The definition of billings in SaaSīillings are what you invoice your customers. Bookings is also the most forward-looking indicator of the three we’re discussing in this post. Looking at bookings will help you understand the trajectory of your business’ revenue growth and financial health, and how well your sales team and product offerings are performing. Upsell bookings-customers who have decided to expand their contract.Renewal bookings-existing customers who are renewing (or have renewed).New bookings-new customers who have just signed for a product or service.So bookings are great-but only tell a part of the story. It’s awesome to close a multi-year contract, but you can’t pay salaries out of future commitments, and you can’t record it as revenue until you provide your service. Your bookings on the contract are $30,000. In a nutshell, bookings represent your customers’ commitment to pay your business for your services.Īs an example, let’s say one of your customers purchases a 3-year plan at $10,000 per year that bills annually. Check out our free Excel template to follow along! The definition of bookings in SaaSīookings is a forward-looking metric that refers to the value of contracts signed with customers. Though the three are linked, make sure you understand what each of them can tell you about the state of your business. The difference between bookings vs billings vs revenue in a SaaS business can confuse even experienced executives.
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