Offering strategy

An offering strategy is a firm’s decision about what it sells, how those services are packaged and named, and what it will refuse to take on. It is the boundary of the business written down, and it governs every proposal that follows.

Pricing sits downstream of it. The offering decides what the unit of sale is; pricing decides what that unit costs. A product roadmap says what gets built next, which is a different question from what you are willing to sell today.

For a provider, the offering strategy is the service catalogue and its edges. It covers which functions you take in the business function outsourcing market, which industries you serve, the smallest engagement you accept, and the work you decline.

Key takeaways

• An offering strategy defines the unit of sale; pricing only decides what that unit costs.
• The refusals matter as much as the inclusions — a catalogue with no edges becomes a custom shop.
• Packaging decides how buyers compare you, which is why public catalogues push sellers into defined categories.
• A proposal that misses a stated requirement is scored as a failure, not as a creative alternative.

How it works

You build an offering strategy in three passes: list what you actually deliver today, group it into packages a buyer can name, then decide the edges. The third pass is the hard one, because every refusal closes a door someone in sales wants open.

Start from evidence, not ambition. Providers selling technology work usually begin from the client’s application portfolio management view, because the list of live applications is the real scope rather than the one in the brief.

Packaging is where margin hides. Most catalogues carry at least one value-added service that costs little to run and is hard for a buyer to price alone, which makes the package harder to break apart on a spreadsheet.

The charging model is part of the offering, not separate from it. A firm that commits to performance based pricing has already decided which results it will be measured on — an offering decision wearing a pricing hat.

Public buyers force the packaging question into the open. Sellers on the General Services Administration (GSA) Multiple Award Schedule pick the special item number that best fits your offering from a fixed list of categories.

Those categories run from information technology and professional services to facilities and transportation. If your offering maps onto none of them you cannot sell it there, which is the bluntest version of a problem every catalogue has.

The penalty for a vague offering is mechanical rather than personal. Part 15 of the Federal Acquisition Regulation (FAR) defines a deficiency as a material failure of a proposal to meet a Government requirement.

Write the exclusions down or they will not hold. A list that lives in the head of one sales director produces a different answer every quarter, and the delivery team finds out after the contract is signed.

Commercial buyers do much the same thing less formally. A requirement you cannot meet is a lost point, not an opening to propose something better.

Examples

Three kinds of firm show the same decision with different edges: a mid sized back office provider, a specialist consultancy and a software vendor moving into services. Each is defined as much by what it turns away as by what it lists.

Back office provider. A Manila firm listing finance and accounting, customer support and data work, with a floor of twenty seats, makes an offering decision every time it turns down a five seat pilot — and that floor is the strategy.

Specialist consultancy. A regulatory practice packages work as fixed deliverables and charges on milestone based pricing, because the client needs a filing date far more than an hourly rate.

Software vendor adding services. The question is whether implementation exists to sell licences or to earn margin on its own. The answer changes the catalogue, the hiring plan and who the services team reports to.

Each of those three firms can describe its offering in one sentence. That is the test: if it takes a slide deck to explain what you sell, the strategy has not been made yet.

Related terms

• Customer life cycle management: runs the relationship after the sale; offering strategy decided what was sold.
• Revenue share model: ties a provider’s fee to the client’s revenue, one way to package an offering.
• Value-added service: the extra folded into a package to make it harder to compare on price alone.
• Performance based pricing: charges against agreed results, so the offering has to name which results count.
• Business function outsourcing: the market an offering strategy competes in, one function at a time.

FAQ

What is an offering strategy?

It is the decision about what your firm sells, how it is packaged and what it will not take on. Everything in a proposal follows from it.

How is an offering strategy different from a pricing strategy?

The offering defines the unit of sale; pricing sets what that unit costs. You can change a price in a week — changing what you sell takes a hiring plan.

Who owns the offering strategy?

The chief executive or the head of the business unit, with delivery and finance in the room. Sales should inform it and should not set it alone.

How often should an offering strategy be reviewed?

Once a year as a formal exercise, and again after any quarter where you lost several deals for the same reason. Repeated losses on one requirement are the cheapest research you will ever get.

What should a provider refuse to sell?

Work it cannot staff, price or measure, and work sitting outside the delivery model it already runs well. Saying no to those keeps everything else deliverable.

Publish what you sell where buyers already compare providers in the Outsource Accelerator hubs.