Parallax Retainer Setup Process
Prerequisites
Before setting up project financials:
- Create the project / Deal in CRM or the PX Pipeline if that is your CRM
- Create a Service Offering Complete the resource plan in Project Shaper
- Ensure planned hours are loaded for all team members (or just the roles if that is all that is available at the time)
- Confirm the project fee from the Pricing Sheet/SOW (Deal). The fee should match what is in the CRM Deal. Do not include pass-through expenses or reimbursable out-of-pocket costs in the fee amount. Service Revenue only.
Step 1: Open Project Financial Settings
- Open the project.
- Select Financial Settings from the project menu.
- Verify the project type is Client.
- Confirm currency is USD (or applicable currency).
Step 2: Enter the Target Budget
In Target Budget:
- Enter the project fee amount from the Pricing Sheet/SOW.
- This should match:
- CRM Deal Amount
- Pricing Sheet Fee
- SOW Fee
Important: Only enter service revenue. Do not include pass-through expenses or reimbursable out-of-pocket costs.
Example:
- Project Fee = $423,000
- Out-of-Pocket Expenses = $80,000
Enter:
- Target Budget = $423,000
Do not enter $503,000.
Step 3: Set Target Margin
- Enter the target margin from the pricing sheet if available.
- If unknown, leave the default and update later.
Future projects should use the margin from the new pricing sheet process.
Step 4: Select Billing Model
Under Billing Model:
Select Fixed Retainer
Step 5: Enter Services Revenue
When Fixed Retainer is selected:
- Uncheck the auto-calculation option if enabled.
- Enter the total project fee in Services Revenue.
Example:
- Target Budget = $423,000
- Services Revenue = $423,000
These values should match
Step 6: Set Revenue Recognition Frequency
Select: Monthly
The workshop recommendation was to use monthly recognition for nearly all projects.
Step 7: Save the Financial Settings
Save the project.
After saving:
- Navigate to the Cost & Revenue tab.
Step 8: Split Revenue Across Project Months
In the Cost & Revenue tab:
- Locate the Services Revenue line item.
- Hover over the line.
- Click the Split icon.
- Choose:
- First recognition date
- Number of months
Parallax will automatically divide the revenue evenly across the selected months.
Step 9: Use Month-End Dates
Example: Use the last day of each month for revenue recognition entries.
Example:
| Month | Recognition Date |
|---|---|
| January | Jan 31 |
| February | Feb 28 |
| March | Mar 31 |
Step 10: Start with Straight-Line Revenue
For initial setup:
- Divide total revenue evenly across project months.
- Don't spend significant time trying to perfect the allocation.
Example:
Project Fee = $120,000
Project Duration = Jan–Mar
Initial Setup:
- Jan = $40,000
- Feb = $40,000
- Mar = $40,000
You can use a simple estimate initially and refining later if needed but note that each entry has to be done manually
Step 11: Update Revenue Monthly
At month-end:
- Review actual revenue recognized.
- Adjust completed months to actual values.
- Reallocate remaining future revenue as needed.
This allows margin reporting to reflect actual performance by month.
Step 12: Add Freelancer and External Costs
If a project uses freelancers or subcontractors:
- Go to the Cost & Revenue section.
- Add an Other Cost line item.
- Enter:
- Vendor/Freelancer name
- Cost amount
- Recognition date
Examples:
- Freelancer cost
- Partner network cost
- Contractor expense
These should be entered as costs to the project.
Step 13: Exclude Reimbursable Out-of-Pocket Costs
Do not enter:
- Travel reimbursements
- Pass-through vendor expenses
- Hard costs reimbursed by the client
Step 14: Handle Change Orders
When a change order is approved:
- Update the project Target Budget.
- Increase Services Revenue accordingly.
- Merge project records if the change order originated as a separate HubSpot opportunity.
- Add any additional resource plans and costs.
The goal is for Target Budget to reflect the full approved project value after change orders.