Taming the SaaS Chaos: Why You Need a Sales Arrangement

Ever feel like you're drowning in a sea of spreadsheets? Are you desperately trying to make sense of your customer contracts? You're not alone! Many accounting teams struggle to get a clear picture of Total Contract Value (TCV), especially with complex SaaS contracts.

Introducing the Sales Arrangement – a powerful concept that can bring order to the chaos and revolutionize your revenue accounting.

What is TCV, and Why Does it Matter?

TCV represents the total value of a customer contract over its entire lifetime. It's a crucial metric for understanding your revenue streams, calculating Remaining Performance Obligation (RPO), forecasting future income, and complying with accounting standards like ASC 606.

But calculating TCV isn't always straightforward. SaaS contracts often involve:

• Multiple Orders: Initial sales, upsells, renewals, add-ons

• Varied Services: Recurring subscriptions, one-time professional services, training

• Complex Terms: Different invoice cycles, payment terms, and renewal options

Traditional ERP and revenue management systems struggle to capture this complexity, leading to inaccurate TCV calculations and reporting headaches.

Enter the Sales Arrangement – Your Revenue Superhero!

A Sales Arrangement is a container that holds all the pieces of a customer commercial contract together. It groups all related sales orders, regardless of their type, giving you a comprehensive view of the entire contract value. The Sales Arrangement also groups relevant metrics for revenue, invoices, payments, subscriptions and more!

Here's how it works:

Acme Corp. purchases your software with an annual subscription for five users in March. In May, they add three users to the subscription and also sign up for professional services for implementation. In December, they renew their subscription early and sign up for additional training.

A Sales Arrangement tracks all of these transactions, providing a clear and accurate picture of Acme Corp.'s TCV over time.

Why is this so Important?

• Accurate TCV Calculation: Get the right numbers without needing manual spreadsheets or workarounds.

• Simplified Revenue Recognition: Easily track and allocate revenue across different contract elements.

• Improved Compliance: Be confident that you’re meeting accounting standards.

• Clear Operational Insights: Gain a deeper understanding of customer value and contract performance.

Everest ERP: Built for SaaS Success

Everest ERP is designed specifically for SaaS businesses. Our built-in Sales Arrangement structure simplifies TCV tracking and revenue accounting. Say goodbye to your messy spreadsheets and custom code. 

Ready to take control of your SaaS revenue? Schedule a demo with Everest today. Email info@everest-systems.com.