BIZOMAT Tools · Business
Subscription Value
Is this subscription earning its keep?
Compares a subscription’s monthly cost with the value of time it saves and other value it creates.
Open the calculatorRuns in your browser. No account needed.
How this tool works
Inputs, units and where to find them
| Input | Unit | Typical source |
|---|---|---|
| Monthly subscription cost | $ | Monthly subscription cost |
| Hours saved / month | hr | Hours saved per month (usage data or observation) |
| Value of time | $/hr | Value of an hour of the people saving the time |
| Other monthly value / revenue | $ | Other monthly value or revenue it enables |
What each input means
Open an input to see what it is, its units, the worked example and the common mistakes, with a small diagram.
What this means: Monthly subscription cost
- What it is
- What the subscription costs each month, including every user licence and add-on you pay for.
- Units and format
- Enter a number in $: an amount of money; use one currency for every money input. The form accepts $0 or more.
- Example
- The form opens with $100 as a worked example. It is an illustration, not a recommended value: replace it with your own figure.
- Effect on the result
- Subtracted from the monthly value to give net value.
- Get it right
- Convert annual plans to a monthly figure by dividing by 12.
What this means: Hours saved / month
- What it is
- The working hours the tool saves your people each month, from usage data or by comparing how long tasks took before.
- Units and format
- Enter a number in hr: hours. The form accepts 0 hr or more.
- Example
- The form opens with 4 hr as a worked example. It is an illustration, not a recommended value: replace it with your own figure.
- Effect on the result
- Monthly value rises by the value of time for each hour.
- Get it right
- Count only time that is put to other useful work; time saved that is not used is not real value.
What this means: Value of time
- What it is
- What one hour of the time saved is worth to the business, usually the loaded hourly cost of the people saving it.
- Units and format
- Enter a number in $/hr: money per hour. The form accepts $0/hr or more.
- Example
- The form opens with $60/hr as a worked example. It is an illustration, not a recommended value: replace it with your own figure.
- Effect on the result
- Monthly value rises in proportion to hours saved.
- Get it right
- Use the loaded cost of the people who actually save the time, not a senior rate.
What this means: Other monthly value / revenue
- What it is
- Any other monthly benefit the subscription delivers, such as extra revenue it enables or other costs it replaces.
- Units and format
- Enter a number in $: an amount of money; use one currency for every money input. The form accepts $0 or more.
- Example
- The form opens with $0 as a worked example. It is an illustration, not a recommended value: replace it with your own figure.
- Effect on the result
- Adds directly to the monthly value.
- Get it right
- Do not count the same time saving here and in hours saved.
Method and formulas
- Value = hours saved × value of time + other value
- Net = value − cost
Limitations
- Time saved is valuable only if used
Typical uses
- Software renewal decisions
- Cutting unused subscriptions
Who it is for
- Business owners
- Managers
What you get
- KEEP / REVIEW VALUE or CANCEL / RENEGOTIATE
- Net monthly and annual value
Interpreting the result
- Check data export and exit terms before relying on a service
Learn the Concepts Behind This Tool
These BIZOMAT Library readings explain the method this tool uses, with worked examples.
Method explained here · BIZOMAT original book
Service, supply and end of life
In Connected Products by the Numbers
What it covers: Price a connected product with its cost to serve, compare service models under churn, decide what to make and buy, and plan for network closures, battery replacement and end of life.
Method explained here · BIZOMAT original book
Choose a licensing model
In Engineering Software You Can Sell
What it covers: Compare perpetual and subscription licences, named and floating seats, trials and site licences on five-year revenue, cash flow, customers' budgets and the promises each model makes.
BIZOMAT tools are screening and decision-support utilities. Verify important financial, engineering, safety, legal or operational decisions using appropriate professional standards and your organisation’s approved data.