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The Challenge

Overhauling Pricing & Billing Model

When MustardSeed PMO began partnering with the client to build their PMO from the ground up, the company’s pricing model and billing activities were disorganized. Business Development (BD) representatives had only loosely defined guidelines for pricing, resulting in inconsistent quotes and difficulty reconciling invoices. All Statements of Work (SOWs) relied on a rudimentary template that offered minimal clarity on kit pricing, billing terms, and custom requirements. As the volume of custom kitting projects grew, these gaps led to inconsistent margins, confusion among staff and clients, and an over-reliance on ad hoc fixes rather than systematic solutions.

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The Constraints

Fragmented Stakeholder Groups:

The company’s “Client Implementation Team” handled complex implementations, while BD reps in the Sales organization managed initial client contracts. Aligning both teams on standardized pricing and account implementation was critical.

Diverse Project Requirements:

The company offered everything from standard test kits to highly customized bundles with specialized printing, API integrations, or unique billing options—necessitating a robust yet flexible pricing framework.

Time-Sensitive Rollout:

The company was actively onboarding new, large-scale clients and needed immediate improvements that would not disrupt ongoing operations, while also capitalizing on better margins through more detailed pricing strategies.

Financial Visibility & Risk

Without uniform deposit and billing terms, the company risked delayed revenue recognition and cost overruns on custom kit orders.

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The Solution

Standardized Pricing Structure

• Created a single, organization-wide “Master BOM” workbook documenting both standard and custom kit components, applying consistent cost-plus markups.

• Established a clear distinction between “standard” and “custom” kit pricing, factoring in additional labor, pass-through printing costs, and higher fulfillment fees for custom kits.

• Developed a simplified “Kit Calculator” so BD reps and the Client Implementation Team could quickly generate quotes with minimal risk of error.

SOW Template Overhaul

• Replaced the outdated SOW template with a detailed framework including line-item pricing (Table 1.3), kit setup fees for unique BOMs, tiered discount brackets for higher volumes, and deposit/prepayment requirements.

• Incorporated net payment terms, volume-based discount thresholds, and kit deposit policies to ensure consistent cash flow.

Comprehensive Training & Change Management

• Created and delivered a training deck (“SOW Pricing – Standard and Custom Kitting”) for all BD reps and project managers, ensuring they understood how to apply the new pricing model and resources.
  
• Established a dedicated communication plan and weekly stand-up meetings to quickly address and resolve implementation issues.

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Integrated Oversight & Monitoring

• Leveraged Monday.com boards and SharePoint repositories to store pricing calculators, BOM sheets, and SOW resources in a single source of truth.

• Created standardized workflows so any new or amended client SOW would follow the same process, ensuring consistent margins and accurate invoicing.

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The Outcomes

Within 1 quarter of implementation:

• Increased Profit Margin: The revamped model reduced losses and increased gross margins by about 15–17% on custom kitting projects.

• Internal Customer Satisfaction: The team of 20+ staff impacted by this changed was polled on a variety of prompts, including effectiveness of training materials, rollout, change management, and others, yielding a satisfaction score of greater than 90%.

• Efficient Contracting: BD reps and project managers produced SOWs quickly and accurately, minimizing errors and improving turnaround times for client quotes.

• Greater Financial Clarity: Deposits and setup fees ensured the company was fairly compensated for up-front custom work, while the updated SOW format clarified billing terms.

• Scalable Process: With a standardized approach and central source of truth, the company could seamlessly onboard large new clients without renegotiating pricing from scratch. Client-facing teams were also empowered with a unified message on how to onboard and manage accounts once they were in the system.

• Greater Financial Clarity: Deposits and setup fees ensured the company was fairly compensated for up-front custom work, while the updated SOW format clarified billing terms.

• Scalable Process: With a standardized approach and central source of truth, the company could seamlessly onboard large new clients without renegotiating pricing from scratch. Client-facing teams were also empowered with a unified message on how to onboard and manage accounts once they were in the system.

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