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Revenue
12 Months Ended
Dec. 31, 2018
Revenue From Contract With Customer [Abstract]  
Revenue

NOTE C – Revenue

We derive our revenues primarily from the following revenue streams (in thousands):  

 

 

 

Year Ended December 31,

 

 

 

2018

 

 

2017

 

 

2016

 

Recurring revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Fulfillment

 

$

190,783

 

 

$

164,682

 

 

$

139,645

 

Analytics

 

 

34,447

 

 

 

34,260

 

 

 

32,938

 

Other

 

 

5,424

 

 

 

4,978

 

 

 

4,474

 

Recurring Revenues

 

 

230,654

 

 

 

203,920

 

 

 

177,057

 

One-time revenues

 

 

17,586

 

 

 

16,165

 

 

 

16,096

 

 

 

$

248,240

 

 

$

220,085

 

 

$

193,153

 

 

Revenues are recognized when our services are made available to our customers, in an amount that reflects the consideration we are contractually and legally entitled to in exchange for those services.

We determine revenue recognition through the following steps:

 

-

Identification of the contract, or contracts, with a customer

 

-

Identification of the performance obligations in the contract

 

-

Determination of the transaction price

 

-

Allocation of the transaction price to the performance obligations in the contract

 

-

Recognition of revenue when, or as, we satisfy a performance obligation

Recurring Revenues

Recurring revenues consists of recurring subscriptions from customers that utilize our Fulfillment, Analytics and Other cloud-based supply chain management solutions.  Revenue for these solutions is generally recognized on a ratable basis over the contract term beginning on the date that our service is made available to the customer.  Our contracts with our recurring revenue customers are recurring in nature, ranging from monthly to annual, and generally allow the customer to cancel the contract for any reason with 30 to 90 days’ notice.  Timing of billings varies by customer and by contract type and are either in advance or within 30 days of the service being performed.

The deferred revenue liabilities for recurring revenue contracts are for one year or less and recognized on a ratable basis over the contract term. We have applied the optional exemption under ASC 606-10-50-14(a) and will not disclose information about the remaining performance obligations for contracts which have original durations of one year or less.

One-time Revenues

One-time revenues consist of set-up fees from customers and miscellaneous one-time fees.

Set-up fees are specific for each connection a customer has with a trading partner and many of our customers have connections with numerous trading partners.  Set-up fees related to our cloud-based supply chain management solutions are nonrefundable upfront fees that are necessary for our customers to utilize our cloud-based services.  These set-up fees do not provide any standalone value to our customers.  Except for our Analytics solution, we have determined that the set-up fees represent a material renewal option right to our customers as they will not be incurred again upon renewal.  These set-up fees and related costs are deferred and recognized ratably over two years, which is the estimated period for which a material right is present for our customers.  For our Analytics solution, we have determined that the set-up fees do not represent a material customer renewal right and, as such, are deferred and recognized ratably over the estimated initial contract term, which is one year.

The table below presents the activity of the portion of the deferred revenue liability relating to set-up fees (in thousands):

 

 

 

Year Ended December 31,

 

 

 

2018

 

 

2017

 

Balances, at beginning of period

 

$

10,031

 

 

$

9,995

 

Invoiced set-up fees

 

 

10,271

 

 

 

10,625

 

Amortized set-up fees

 

 

(10,445

)

 

 

(10,589

)

Balances, at end of period

 

$

9,857

 

 

$

10,031

 

 

The entire balance of set-up fees will be recognized within two years and, as such, current amounts will be recognized in the next 1-12 months and long-term amounts will be recognized in the next 13-24 months.

Miscellaneous one-time fees consist of professional services and testing and certification. The deferred revenue liability for these one-time fees are for one year or less and recognized at the time service is provided. We have applied the optional exemption under ASC 606-10-50-14(a) and will not disclose information about the remaining performance obligations for contracts which have original durations of one year or less.