What is CPQ software, and how could it benefit your organization? CPQ stands for configure-price-quote. CPQ software is a suite of tools that centralizes and automates every part of the quoting process. This gives team members instant access to the data they need.
It also helps sales teams quickly and accurately create sales quotes, even if there are an endless number of sales variables. As soon as a sales rep enters an order, the CPQ software automatically runs through every possible variable and makes pricing adjustments as necessary.
This frees reps to spend more time earning business and following up with leads. Instead of manually updating the quote to account for customizations, discounts, and other options, they can take a more active role throughout the customer journey.
Capabilities of CPQ Software
Some of the most common features and capabilities of CPQ software include:
• Data analytics
• Guided selling
• Price adjustments
• Quote amendments
• Standard/non-standard deal management
• Asset-based ordering
• Quote-to-order conversions
These are all processes that most sales reps can do on their own.
However, by the time they’ve looked up pricing rules, sifted through outdated information, and performed calculations by hand, prospective buyers are often frustrated. Even then, there’s no way to guarantee that all the calculations are accurate, or that all applicable rules have been applied.
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1. Support for Diverse Product Suites
Some companies offer a variety of types of products and services. Others might sell product bundles that require customizations. In these cases, it can be difficult and time-consuming for sales reps to configure multiple variables on the spot.
With CPQ software, reps can associate defined pricing with each specific feature, which takes the guesswork out of the equation.
At the same time, reps maintain control and authority over the closing price. Once that final number is in place, they can adjust it to incorporate special discounts, promotions, and other changes as required.
2. Shorter Sales Cycles
Your sales team worked hard to acquire a new lead, and the outlook was promising. Then, the sales process dragged on and the lead’s interest waned. Has this ever happened at your company?
CPQ software simplifies and automates processes that can slow down the sales cycle, including:
• Quote generation
• Order renewal
• Deal analysis
The quick turnaround helps sales teams maintain momentum as they talk to qualified prospects and leads. Even the most complex quotes can be ready in minutes, which allows reps to strike while the interest is there.
3. More Accurate Price Quotes
Any time you eliminate the need for manual work, you naturally improve the accuracy of your calculations.
Not only can errors slow down the sales process, but they can also damage your brand integrity and reputation.
When companies use CPQ, pricing errors are non-existent — as long as the rules are entered correctly. Once clients choose the product and service combinations they want, the software automatically creates a price quote.
4. Ease of Use
Say a lead accepted your quote and decided to move forward with the purchase, but then, they needed to adjust one of the line items. How quickly would your sales team be able to respond?
The ability to react swiftly and accurately to a client-driven change is a characteristic that top-performing companies share. In addition to responding to outside requests, these companies can quickly update quotes based on other factors, such as discounts.
The beauty of CPQ software is that it’s designed to be as user-friendly as possible. The tool runs on built-in rules, so there’s no need for users to enter complex configurations when making changes.
Even employees who have never used pricing software before should find quote updates easy to navigate.
5. Improved Customer Experience
It’s no secret that today’s customer is looking for more than just low prices. They also want personalized treatment that makes them feel like they aren’t just a number.
When you implement CPQ software, you enable buyers to take the reins and develop their own quotes. In many cases, buyers can even access 3D visuals to represent each option, which greatly simplifies the decision-making process.
When customers are confident in their choices and configurations, they’re more likely to get exactly what they want. In addition, when their orders are fairly priced and 100% accurate, they’re more likely to make repeat purchases.
In this way, CPQ can be a valuable tool for companies that need to improve customer retention and engagement.
This technology integration will become especially helpful as manufacturers make their product portfolios even more complex and configurable.
What is CPQ Software? Learn More
If your sales team is spending too much time crunching numbers and too little time bringing in new leads, it might be time to reconsider your approach.
What is CPQ software? It could be the missing link between your current position and your future sales growth.
This software automates the manual, complex parts of the pricing and quoting process, which is especially relevant to products that have complex configurations and detailed ordering options.
Our ERP consultants can help you understand what type of business software you need based on your sales and quoting requirements, as well as your overall organizational goals. To get started, request a free consultation below.