Revenue Breakdown Calculation for ISV SaaS via Azure Marketplace

This article explains how to calculate the net revenue for an ISV SaaS Product when sold through a Reseller channel. In our example, the product is sold at a gross price of $100. The following deductions are applied as follows:

1. Reseller Margin: The reseller takes a margin on the gross price based on what is negotiated in your CSP Private Offers.
2. Local Tax: A local tax is applied to the amount remaining after the Reseller’s margin.
3. Microsoft Transaction Fee: A store fee of 3% is also applied to the post-Reseller margin amount.

These deductions leave you with the final net revenue for the ISV SaaS Product.

Step-by-Step Breakdown

Step 1: Gross Price and Reseller Margin

• Gross Price: $100
• Reseller Margin (assume a 10% margin is negotiated):
  • Calculation: 10% of $100 = $10
• Amount after Reseller Margin:
  • Calculation: $100 − $10 = $90

Step 2: Deducting Tax

• Local Tax (for RSA its 15%):
  • Calculation: 15% of $90 = $13.50
• Amount after Tax:
  • Calculation: $90 − $13.50 = $76.50

Step 3: Deducting Marketplace Transaction Fee

• Standard Microsoft Marketplace Transaction Fee (3%):
  • Calculation: 3% of $90 = $2.70
• Final Revenue for ISV SaaS Product:
  • Calculation: $76.50 − $2.70 = $73.80

This example clearly shows the sequential deductions from a gross price to arrive at the net revenue for the ISV SaaS Product. Adjust these figures and percentages as needed to reflect your specific contractual and regulatory requirements.