Assessment Part 4:
Do you have a comprehensive revenue & profitability model?
☐ 12 month revenue plan: Ties to the annual operating plan and projects the revenue contribution from your sales operation (monthly & quarterly revenue goals tied to individual sales targets for bookings, revenue, activations, add-on, average sales value & service mix).
☐ Profitability plan: A model to measure & manage the profitability of your sales operation that includes cost of service delivery, gross margin on services, the cost of customer acquisition, average sales discounts & average deal value for new orders.
☐ Deal economics: A measurement of the economics associated with an average deal that allows you to understand its average one-time and recurring revenue value, seat count, service mix and blended gross margins.
☐ Cost of acquisition: Metrics that measure the sales & marketing cost of acquiring each new customer using the gross margin dollars generated by a new service contract and expresses the acquisition cost either as a payback period (in months) or as a multiple of total lifetime customer value (total profits over the contract term).
☐ 3 year revenue and profitability model: A multi-year model to ensure revenue growth and profitability track to your long term business plan (includes the rate of customer acquisition, one-time revenue & recurring revenue growth and is based on historical data or assumptions for sales productivity, average deal values, service mix, contract term and churn rate).
Complete Your Own Business Assessment Checklist
☐ Profitability plan: A model to measure & manage the profitability of your sales operation that includes cost of service delivery, gross margin on services, the cost of customer acquisition, average sales discounts & average deal value for new orders.
☐ Deal economics: A measurement of the economics associated with an average deal that allows you to understand its average one-time and recurring revenue value, seat count, service mix and blended gross margins.
☐ Cost of acquisition: Metrics that measure the sales & marketing cost of acquiring each new customer using the gross margin dollars generated by a new service contract and expresses the acquisition cost either as a payback period (in months) or as a multiple of total lifetime customer value (total profits over the contract term).
☐ 3 year revenue and profitability model: A multi-year model to ensure revenue growth and profitability track to your long term business plan (includes the rate of customer acquisition, one-time revenue & recurring revenue growth and is based on historical data or assumptions for sales productivity, average deal values, service mix, contract term and churn rate).
Complete Your Own Business Assessment Checklist
