Glossary:

Sales Methodology & Process

Master the essential revenue and financial metrics that drive B2B SaaS success. From ARR and MRR to retention metrics and customer economics, these terms are critical for understanding pipeline health, forecasting growth, and making data-driven decisions.

Business Case

Short Definition

A structured, quantified justification for investing in a solution, used by champions and executives to decide whether and why to move forward.

Definition

In sales, the business case synthesizes discovery, value modeling, risk analysis, and implementation planning into a narrative that justifies the purchase. It is usually prepared collaboratively between the seller and an internal champion.

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Strong business cases are clear, quantified, and tailored to the decision-makers’ priorities.

Why Business Cases Matter

  • Provide a formal rationale for spending, especially in larger deals.
  • Help champions secure internal approvals from finance and leadership.
  • Align diverse stakeholders on problems, outcomes, and tradeoffs.
  • Reduce late-stage “why are we doing this?” objections.
  • Support post-sale value tracking and renewal conversations.

How to Build a Business Case

An effective business case follows a simple, structured format:

1. Executive Summary

Brief problem statement, recommended solution, and headline impact.

2. Current Situation and Problem

What is happening today and what it costs.

3. Proposed Solution

Overview of your solution and why it fits.

4. Financial Analysis

Costs, benefits, ROI, and payback period.

5. Risks and Mitigations

Key risks and how they will be managed.

6. Implementation Plan

Timeline, milestones, and responsibilities.

Business Case Structure

Section Purpose
Problem & Context Explain why change is needed
Options Considered Show alternatives, including “do nothing”
Recommended Option Present your solution as the chosen path
Financials Costs, savings, revenue, ROI, payback
Risks Identify and mitigate key risks
Plan Show how it will be delivered

Simple ROI Example

  • Annual Benefit = (Time Saved × Cost per Hour) + (Extra Revenue) – (Reduced Losses)
  • ROI (%) = (Annual Benefit – Annual Cost) / Annual Cost × 100
  • Payback Period (months) = (Initial Investment / Monthly Benefit)

Key Metrics

  • Percentage of late-stage opportunities with a formal business case.
  • Approval rate for deals with business cases vs. those without.
  • Average ROI and payback period presented.
  • Time from business case submission to decision.
  • Renewal and expansion rates when initial business case metrics are tracked.

Common Mistakes

Mistake Fix
Reps present generic templates that don’t reflect the customer’s reality, so executives ignore them. Customize the business case with the customer’s data, metrics, and language, co-creating it with your champion.
Reps use financial analysis that’s too complex or opaque, leading to skepticism. Use simple, transparent calculations and clearly state assumptions so finance and leadership can follow and challenge them.
Reps ignore or minimize risks, making the proposal seem unrealistic. Acknowledge key risks and present concrete mitigation plans to build trust.
Reps create the business case too late, after leadership already formed opinions. Start building the business case during mid-stage conversations and socialize it with stakeholders before final approval.
Reps don’t revisit the business case post-sale, so the customer is unclear about value realized and is less likely to renew. Track actual results against the original business case and use them in QBRs and renewal discussions.

Frequently Asked Questions

Who owns the Business Case?

The internal champion usually owns it, but strong sales reps co-create and provide templates, data, and structure.

When do I need a Business Case?

Create a Business Case when a deal is large, strategic, and/or the cost is justified.

How detailed should the financials be?

It needs just enough detail to be credible and defendable; too much complexity can backfire. If you can, test it internally before presenting to the buyer.

Should the Business Case include alternatives?

Yes. Include the cost of doing nothing, which strengthens your case.

How do you keep the Business Case alive post-sale?

Share it with Customer Success so they can use it for value tracking and QBRs.

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