Sales Bookings Vs Revenue

Revenue might be the same thing 50.

Sales bookings vs revenue. Revenues higher than bookings suggest a growing business. But if the use of that thing requires you the seller to ongoing support you might have to spread that booking out over time. In the case of saas the core operation is delivering cloud based services according to the contract and the sla.

Revenue recording is time specific in that companies cannot move revenue from one accounting period and record it in another accounting period. One of the most important sales metrics for companies to track and analyze is bookings. Although revenue is nearly always the larger figure it.

It s when the revenue counts on the books. First they need to know how well the company is doing on a total sales basis. I want to buy what you re selling where do i sign a booking is when the customer makes a commitment via a contract to buy your services or product.

Revenue on the other hand is when the geniuses in accounting can account for the revenue as being recognized. A contract isn t required to have a booking as someone who signs up for a month of your saas offering is committing to that month of service without signing anything. Bookings a booking is when a customer agrees to spend money with you.

So you sold something for 50. You sell a membership to your site for 120 a year. Sales may be defined as prices paid by customers while revenue signals the overall money a business generates during a given time period.

The 120 is a sale a booking. Compared to bookings which in a specified period of time is the total value of contracts signed revenue refers to a reasonable guarantee that the contracts will materialize. The ceo needs this information at two levels.