Apr 23, 202111:29 AM - edited Apr 23, 202111:29 AM
Dealing with big deals - multi-year framework agreements
I was wondering whether any of you have the same challenge or how you deal with it.
For any NEW business type of deal in our case the buying process is very long and complex. In some cases a deal that starts at a lead/qualified lead stage can be a 3year framework agreement for XYZ mln $ (estimated value that evolves) although product line items/pricing/margin etc are only determined just before the agreement is signed.
The challenge is how to report on these kind of deals in forecasts. Close date which can be this year (or next year), although revenue recognition will be split throughout 3 years to come. If I do not include any of it in this year's forecast (even weighted amount), I'm undervaluating my forecast. I cannot include full 3year agreement either. How to ensure more accurate reporting? Custom deal properties that would reflect estimated revenue per year if agreement is to be signed for 3 years in this case?
Nice to meet you, is your business a software company selling multi year deals? If the answer is yes then the recurring revenue fields in HubSpot may well help you from a forecasting standpoint. I know its a little left field as its not a yearly breakdown, but actually the monthly recurring revenue reporting could help. But only if your selling Software As A Service, so appreciate it won't work otherwise.
If the answer is no you don't work for a software company, then I can ask some other HubSpot customers and see what they are doing.