Quoting and Renewal Management Challenges for Professional Services Firms

I think one of the funnier series of ads on TV are the Geico commercials where the slogan is “everybody knows that.”

You are probably asking yourself what do the “everybody knows that” commercials have to do with Quoting and Renewal Management. If I were to star in a Geico commercial and say, “Did you know that it is important for companies to standardize their quoting process and ensure that renewals are not missed,” you would say, “Everybody knows that.”

Of course, despite the fact that “everyone knows that,” there are a significant number of companies that don’t develop quotes using standardized pricing or a standardized quote template. Additionally, the number of companies that do not have strong renewal management process often lose out on revenue by not following up with the customer to manage the renewal process.

Selling Challenges for the Professional Services Industry

Some professional services firms sell both services (on an hourly, project or annual basis) as well as a “product” (reselling a product or selling a custom-built solution). Even if you don’t sell a product and only sell services, there are several reasons why selling services in a consistent way can be difficult. Some of the reasons are:

  • No standard quote template for everyone to use.
  • Each sales rep is given the “freedom” to modify or use their own template.
  • No standard price list or this price list is not easily accessible.
  • Too many price lists and the sales reps are not sure when to use which list.
  • Quoting can be difficult when there are multiple services that are dependent on previously selected services.

How to Quote in the Professional Services Industry

For organizations that do not use a CRM system (i.e. Salesforce), there are often multiple quote templates that are used by the sales reps and the amount of time it takes to populate these quote templates can be significant. This is due to having to rekey information into the template such as company information, product information, pricing per product, and total cost. By implementing a solution like Salesforce, all that data can be merged onto a standardized template so it can be emailed out. This works great assuming that the sales rep or pre-sales person, who is building the solution in the CRM system, is using the correct price list.  Many price lists are stored in the ERP system and if they are not brought down into Salesforce, there is a chance that the wrong pricing data can be entered. We have found that companies who synchronize their price lists into Salesforce (and define which price lists belong to what companies), achieve significantly more accurate quoting.

That all sounds great however if I am selling a solution where the selection criteria will change based on previously selected items, users need to have the “guardrails” built to ensure they are quoting accurately. I like to use the automobile websites in this example. If you go onto one of these websites and configure your own car, you can select all your choices like color and model. If you select the low-end model, your only choice for seats could be cloth seats. However, if you select a high-end model, you can choose between cloth and leather seats. Many companies use CPQ (Configure, Price and Quote) tools to both build the business logic and have the users build quotes using this logic. In addition to providing configuration logic described above, your firm may have product bundles in place where if you have 3 products (A, B, and C) each priced at $10, you can buy the bundle of all 3 items for $25 (instead of $30 if bought individually).

Professional Services Quoting with Salesforce

As solutions get configured in Salesforce and a quote needs to be sent to the customer, Salesforce can easily create the quote and email it out to your prospect or customer. Many clients have automation in place to ensure that the sales rep follows up in a few days. It is astounding how many companies spend the time (and money) to create the quotes to only never follow up on them.

Once your sales team closes the deal and the client is onboarded, life is good. With much of business moving to a recurring revenue model, the hope by many companies is that each sale builds your MRR (monthly recurring revenue) or ARR (annual recurring revenue). This could have been done by selling them an annual support contract, a product, or a custom-built solution.  Without proper systems and notifications in place, it is common that companies lose out on that recurring revenue.

Automation Renewal Management Solutions for the Professional Services Industry

To solve for this problem, Sikich has built several renewal management solutions for our clients such as:

  • Automatically creating a renewal opportunity with a close date of 12 months after the actual sale;
  • Automatically creating a renewal process for clients where tasks are assigned to one or multiple users starting approximately 90 days prior to the renewal; and
  • Automatically sending an email to the client at a specified time prior to the renewal to both notify them and initiate the renewal process.

The key word in all 3 bullet items is automatically. Most can relate to a growing lists of things to do and endless things to remember. Salesforce can provide the automation that we all need to grow our businesses. Many companies need to grow but can’t afford to add headcount proportionally to their projected growth.

By leveraging Salesforce, companies have achieved those business results. Ready for a Salesforce partner to meet your unique challenges? Let’s talk!

This publication contains general information only and Sikich is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or any other professional advice or services. This publication is not a substitute for such professional advice or services, nor should you use it as a basis for any decision, action or omission that may affect you or your business. Before making any decision, taking any action or omitting an action that may affect you or your business, you should consult a qualified professional advisor. In addition, this publication may contain certain content generated by an artificial intelligence (AI) language model. You acknowledge that Sikich shall not be responsible for any loss sustained by you or any person who relies on this publication.

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