Recommended tools
How this calculator works
Monthly Recurring Revenue (MRR) is calculated by summing each tier's price multiplied by the number of subscribers in that tier. Annual Recurring Revenue (ARR) simply multiplies MRR by 12, assuming stable subscriber counts. Churn impact is computed by multiplying MRR by the monthly churn rate, revealing how much revenue bleeds out each month from cancellations and downgrades. The calculator also derives Average Revenue Per User (ARPU) by dividing MRR by total subscribers, which helps identify whether your tiers are balanced or if most users cluster on the cheapest plan.
Useful scenarios
- A solo SaaS founder projecting MRR and ARR from 200 basic ($19), 80 pro ($49), and 20 enterprise ($99) subscribers.
- A creator evaluating whether adding a $99 enterprise tier is worth the development effort vs raising the pro tier price to $59.
- A bootstrapped startup modeling how reducing monthly churn from 7% to 4% changes annual revenue retention.
FAQ
How many pricing tiers should a SaaS have?
2–3 tiers is standard. Too few limits price anchoring. Too many confuses buyers. The classic structure is a low-cost basic tier, a mid-range recommended tier, and a premium enterprise tier.
What is a healthy monthly churn rate?
For SMB SaaS, 3%–7% monthly churn is typical. For enterprise SaaS, 1%–2% is more common. Below 3% is excellent for self-serve products. Above 10% signals a product or pricing problem.
How does ARPU help with pricing decisions?
ARPU (average revenue per user) tells you if your tiers are balanced. If ARPU is close to your basic tier price, most users are on the cheapest plan—a sign your mid-tier needs better value or your pricing structure needs adjustment.