About This Model
This subscriber model lets you forecast your subscriber numbers for multiple subscriber types according to the equation C = O + A – D, where C=Closing, O=Opening, A=Additions and D=Disconnections.
Typically disconnections is calculated via a churn percentage assumption and is expressed as D = (O + C) / 2 * P, where P=Churn Percentage.
This template deals with only one subscriber type (labelled “A” in this model), but with Sumwise’s modelets feature, it is very easy to add new subscribers types, and reorder and rename these types. We suggest you watch the 2 minute demo video to see how this works, but if you don’t like reading manuals you’re welcome to jump right in and try inserting a new row above or below “A” to see what happens.
About the Disconnections Equation
If you’ve reviewed this model carefully you’ll probably want to know how disconnections are being calculated. As mentioned above, typically the churn percentage is expressed as a percentage of average subscribers for the period. Therefore churn is a percentage of (Opening+Closing)/2. But, Closing is affected by disconnections, so we have a classic circularity in this calculation. We have solved this problem with some simple algebra so that disconnections is calculated without reference to closing subscribers.
In this model disconnections is calculated as:
-(Churn Percentage*(2*Opening+Additions))/(Churn Percentage+2)
For more about this method of solving circular references read this blog post.
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Sumwise addresses all of these problems with clever features like: user defined row and column names; rows and columns that can be tagged with meaningful keywords; and cell groups that share a common formula and formatting across a range a related cells.
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