Deal Profitability Scoring

Not all revenue is created equal. A deal scoring system quantifies the financial quality of each opportunity before it closes — not after. The score incorporates margin, sales cost, implementation complexity, support burden, and strategic value. It does not replace judgment. It makes judgment informed. A rep looking at a deal score of 38 out of 100 understands the economics in a way that "this might be a tough deal" never communicates.

1. Component 1: Margin Score (0-30 pts) Expected contribution margin percentage mapped to a 30-point scale. Above 60% contribution margin: 30 points. 45-60%: 20 points. 30-45%: 10 points. Below 30%: 0 points. This is the largest component because margin is the most important determinant of deal quality.
2. Component 2: Efficiency Score (0-25 pts) Sales cost as a percentage of first-year revenue. Below 15%: 25 points. 15-25%: 18 points. 25-40%: 10 points. Above 40%: 0 points. Efficient deals that close quickly with standard process score high. Deals requiring 14 months of pre-sale engineering score low.
3. Component 3: Retention Score (0-25 pts) Predicted retention based on segment, use case, and product fit. Scores based on historical retention rates for similar deals. A deal in a segment with 95% gross retention scores 25. A deal in a segment with 78% retention scores 8. Future value depends on whether the customer stays.
4. Component 4: Strategic Score (0-20 pts) Expansion potential, reference value, market positioning, and ecosystem effects. This is the qualitative component — the one that allows a lower-margin deal to score well if the strategic value justifies it. But strategic value must be specific and measurable: "expansion into a $2M account" is strategic. "Big logo" is not.