What monthly recurring revenue (MRR) is and how to calculate it
By Jorge Avila Meléndez · updated Sunday, September 27, 2026 · 7 min read
"How much did we sell this month?" is the usual question, but it hides something important: selling once is not the same as selling every month. Monthly recurring revenue (MRR) separates the two and tells you how much of your business is already secured.
The definition in one line
Monthly recurring revenue = what your recurring customers pay you that month. In Back to Zero the monthly goal also adds the one-time sales of the month, so it reflects everything you sold.
- Recurring: billed periodically for as long as the customer stays, such as a retainer, subscription, maintenance plan, rental or monthly fee. It is logged with its monthly amount and counts every month until the customer cancels.
- One-time: billed once, such as a project, equipment, an implementation or a course. It counts only in the month it was sold.
The underlying difference is explained in recurring vs. one-time sales.
A month-by-month example
An agency starts the year like this:
- January: signs customer A on a 20,000/month retainer and sells a one-time project for 15,000.
- February: signs customer B at 10,000/month.
- March: sells another one-time project for 30,000.
- April: closes nothing new.
| Month | Recurring | One-time | Total for the goal |
|---|---|---|---|
| January | 20,000 | 15,000 | 35,000 |
| February | 30,000 | 0 | 30,000 |
| March | 30,000 | 30,000 | 60,000 |
| April | 30,000 | 0 | 30,000 |
In April there were no new sales and the agency still bills 30,000: that is the power of recurring revenue. On top of that, those 30,000 a month are worth 360,000 over the next 12 months (recurring × 12), as long as customers stay.
Why your goal should be recurring revenue
A "sales this month" goal starts at zero on the 1st. A recurring revenue goal grows with every recurring customer you add, because what you signed in January still counts in December. The goal rewards building, not just hunting this month's deal.
In Back to Zero, each year's MRR counts the recurring sales signed that year (plus the month's one-time sales). Every January 1 it goes back to zero to measure what your team adds that year: recurring revenue from previous years is already your base, and the goal measures growth. To define and split it, follow how to set and split your sales goal.
Common mistakes
- Logging an annual contract paid upfront as monthly recurring. If the customer pays 12 months in advance, it's a one-time sale that month. If they pay monthly, it's recurring with the monthly amount.
- Including sales tax. Log amounts before tax so you compare like with like.
- Forgetting cancellations. When a recurring customer cancels, record the end date: it stops counting from the following month, and your MRR stays real.
- Mixing collections with sales. MRR measures what was sold, not what was already collected.
How Back to Zero calculates it
When you log a sale you choose recurring (with its monthly amount) or one-time. Back to Zero does the rest:
- the dashboard and the morning email show the month's MRR, its recurring and one-time parts, progress against the goal, what's left and what your recurring revenue is worth over 12 months;
- if the sale is shared, each rep counts their percentage;
- with the client catalog, you also see how much MRR comes from new clients and how much from existing accounts.