.png)
Estd 4.22.2023
Based on our pricing strategy book, Price to Scale, enterprise deals inherently require a higher degree of customization compared to smaller or more standardized deals. However, while custom pricing and contract terms are common in large engagements, it's crucial to manage this flexibility to prevent complexity from escalating. Here are some key points on how to approach this:
• Direct Customization:
Our book explains that enterprise customers often negotiate on elements such as payment terms, service specifications, or indemnity clauses (see Page 127). This means that it’s normal to tailor aspects of the contract to fit their unique needs.
• Standardized Guidelines:
Although you may adjust pricing and contract details for big customers, it’s important to have clear frameworks in place. For instance, using modular or good-better-best packaging approaches (discussed around Page 29) helps keep customizations in check by predefining core elements that can be tweaked without rewriting the entire deal structure.
• Deal Desk & Account Management:
The book also emphasizes the role of having a centralized "deal desk" or dedicated account managers. These teams are responsible for handling complex negotiations in a consistent manner. They use standard guidelines to address customization requests and ensure that any deviations are deliberate and align with overall strategic pricing and profit objectives.
• Pre-Approved Ranges:
For enterprise deals, there’s typically a set of pre-approved pricing adjustments and contract negotiation boundaries (with discounting levels sometimes going up to 80%). Having these defined ranges prevents ad-hoc decision-making and ensures that every deal remains within acceptable strategic limits.
In summary, while custom pricing and contract negotiations are a natural part of enterprise deals, employing structured frameworks and dedicated teams allows you to offer necessary customization without it getting out of hand. This approach ensures consistency in execution and maintains control over complex deals while still meeting your large clients’ needs.