Profitable Sales Quotations

Constance Tan

10 min read

Worried about under-costing your sales deals? Use this simple workflow to creating and managing a sales deal that helps you avoid going under budget

Worried about undercosting your sales deals? Use this simple workflow to creating and managing a sales deal that helps you avoid going under budget:






Create a product, and detail its scope, quantity, terms, etc.

Explain what it is, what it provides, and/or what it solves.

You can also provide Add-ons to upsell your customers.


Calculate the product’s cost to you, and (if possible): create best/worst scenarios 

Capture all the costs needed to deliver a product/service

Establish the profit you require on your sales deal, and make sure you are safe within best and worst scenarios.

Plan for cases where costs can suddenly balloon.


With aid of the cost, set its price, and payment terms.

Communicate the prices you wish to offer to your customer. 

Establish how and when you will receive payment.


Set up a way to track deal fulfilment, and any add-ons or extra work done for the deal.

Measure completion, and monitor if you’ve needed to do extra things on top of what has been initially agreed.

Ensure what has been fulfilled, gets billed properly. Especially with Add-ons.


Repeat 1-4 for all products / items in the deal

Ensure 100% of the customer’s needs are covered in a consistent manner.


State the Quote/Proposal’s Validity

Communicate time urgency to the customer, and to protect yourself when things change over time.


Set up a way to track payments from customer

Ensure the customer meets agreed payment amounts and deadlines. 

Maintain a healthy cash flow. 

Track Customer payment reliability.


Schedule a regular time a week or month to review the profitability of sales deals over time.

Ensure current method of quoting meets profitability goals

Identify any current problems with your active sales deals

Improve your offerings’ prices, or quoting strategy.

Why this works:

You’ll understand your actual profitability wiggle room

When you offer different things to different customers, it’s easy to lose sight of your overall profitability. 

Regular checks on your sales deals help you understand if you’re hitting your profitability goals or not, and how much discount you can actually afford to give.


You can decide if something’s worth outsourcing or automating

When you track your costs, and how you get work done, you might be able to identify a part of your business that would be easier/cheaper if it’s done differently. 

Just remember to track these outsourcing costs in each affected project properly!


You’ll be better at chasing money in

Delayed cash flow affects everything else. Make sure clients pay on time so you can run your business well.

It’s not over until the money reaches your bank account. If your customers sign on a good sale, but they don’t pay up, your profitability will still be bad!

Adjust your prices based on how reliable your customers are. You can reward lower risk customers with better deals, and protect yourself against higher risk customers. 

All of this can be done if you can track outstanding/overdue payments well. 


Ad Hoc work/Offering Support kills. But it doesn’t have to.

A common mistake is offering after sales support, or warranty, but not measuring how much work it actually costed you to do so. 

Tracking what ad hoc services, additional products or spare parts were required for each deal helps you price better in the next quote. This may need review on a customer-to-customer basis. For example, a larger customer may have incurred 20% more cost you than you’ve initially budgeted for. You can then set a special pricing for such kinds of customers.


You can better adapt to what your customer wants

The more upfront work you put into setting up quote-to-cash workflows properly, the better you can delight new customers, and the more time you’ll save overall.

The better a quote fits customers’ needs and expectations, the more likely it will close. 

  • A quick quote works better for simple deals, single-buyers.
  • A long proposal works better for complex deals, with multiple stakeholders.

Sending out quotes happens very early in the sales process, so if it is costing you lots of time and money, it will definitely hurt your profitability!


Improve your quoting process with each quote

Our example workflow helps you plan, but also helps you measure how well you quoted each time. The biggest mistake in sending out underpriced quotes is missing out products, efforts, services, and time spent that’s actually part of completing a sales deal. 


It’s common to make this mistake when first starting out, so don’t panic! By putting in a process to track, analyze, and adjust your quotes, eventually you’ll be able to make profitable quotes that delight your customers.


Constance Tan

Host of the Doing In Spite Of Podcast

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