Slow quotes, messy pricing, and chaotic sales processes are nightmares for many companies. Manufacturing, tech, and SaaS companies often face these struggles.
Common challenges they face include:
- Handling large volumes of orders and complex pricing models.
- Maintaining uniform pricing and product offerings across sales reps to ensure consistency.
- Increasing customer demand for fast and accurate quotes, which overwhelm systems.
- Rising errors from manual processing that slow down sales and frustrate customers.
- Providing personalized and accurate quotes with configurations for complex products.
To streamline the entire sales cycle, and overcome all these challenges, organizations need to adopt a robust solution.
CPQ software solutions are the lifesavers here!
What is a CPQ Solution and How Does it Work?
CPQ (Configure-Price-Quote) is a specialized software tool designed to help businesses streamline the sales process, especially when dealing with complex products or services.
CPQ solutions simplify these three key steps:
- Configure: Customize products based on customer needs.
- Price: Automatically calculate the correct price.
- Quote: Generate accurate, professional quotes quickly.
How Does CPQ Work?
Step 1: Data Integration
Imports product and pricing information from ERP systems, along with necessary details like promotions, discounts, and configurations.
Step 2: Creating Quote
Generates quotes by pulling relevant customer data from CRM systems and applying accurate pricing rules based on the customer’s specific needs.
Step 3: Customizing & Configuring
Guarantees that products are accurately customized to meet customer-specific needs, including features and optional add-ons.
Step 4: Automating Approval
Automates pricing and discount checks, speeding up approvals and reducing wait times.
Step 5: Recording Data
Once the quote is finalized, the data is pushed back into the CRM for easy storage, keeping customer records up to date.
Example: CPQ for a Luxury Car Manufacturing Company
Let’s check how a CPQ can enhance sales efficiency in a car manufacturing company, as cars are highly customizable products for each customer.
Assume that a customer wants a car with specific features – sunroof, leather seats, custom paint color, and premium sound system.
1- Customized Product Selection
Sales reps select the right options based on customer preferences, such as sunroofs, leather seats, paint color, and premium sound systems.
2- Instant Price Calculation
CPQ automatically calculates the cost of custom configurations, factoring in discounts and promotions to provide an accurate price.
3- Discount Validation
The system ensures that any discounts offered stay within pre-approved limits, helping maintain profitability without limiting flexibility.
4- Accurate Quote Generation
CPQ quickly generates a detailed, professional quote with all the custom options, pricing, terms, and conditions included.
5- Seamless Proposal Submission
A formal proposal, complete with the full offer and proforma invoice, is instantly generated and sent to the customer for review.
6- Streamlined Deal Finalization
Once terms are agreed upon, CPQ ensures swift internal review and finalization, eliminating bottlenecks.
7- Automated Approval Process
Quotes are routed for approval automatically when needed, speeding up decisions and minimizing delays in closing deals.
8- Integrated CRM Updates
After finalizing the quote, all relevant data is updated in the CRM, keeping customer records current and easily accessible.
This entire process with a CPQ tool speeds up the process, allowing the sales team to close deals faster with accurate, error-free quotes instead of making them confused and tiring with running between engineering, finance, and other responsible teams.
How CPQ Drives Efficient Scaling in Fast-Growing Companies
Here is how CPQ solutions help companies scale their entire sales processes efficiently:
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Automating Repetitive Tasks
CPQ automates price calculations and quote generation, reducing administrative work and increasing efficiency.
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Boosting Sales Productivity
Salespeople can focus more on closing deals rather than tedious manual processes.
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Improving Accuracy
CPQ ensures precise pricing and quotes by automating updates based on customer needs.
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Faster Response Times
Automated quoting and streamlined workflows speed up customer responses, closing more deals faster without errors and hiccups.
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Custom Configuration
CPQ allows easy product customization without errors, meeting diverse customer needs quickly.
Key Benefits for Fast-Growth Companies
The smooth quote generation and deal closures enabled by Configure Price Quote solutions benefit the entire company by:
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Scalability
CPQ adapts to expanding business requirements, customer demands, regions, and other changes without sacrificing efficiency.
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Consistency
Standardizes pricing and product configurations across all sales channels to keep consistency and reduce any errors and mismatches in any systems.
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Improved Customer Experience
Faster, smoother, and error-free quotes that cover all customer requirements and needs lead to higher satisfaction, thereby gaining trust from customers.
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Data-Driven Insights
CPQ provides analytics for better decision-making and growth strategies as leaders can track everything from one place.
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System Integration
CPQ integrates seamlessly with CRM, ERP, and other tools or systems, streamlining operations across departments and reducing silos.
Now, the challenge for decision-makers is finding the right solution from the best CPQ solutions available in the market.
Key Considerations for Selecting the Right CPQ Solution
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Choose the Right CPQ Vendor
As a first step of opting for a CPQ tool, consider your current tech stack, team size, and required features and ensure the solution fits your industry needs (e.g., product complexity, pricing models) and aligns with your entire sales cycle.
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Prepare Your Team
Communicate changes early and ensure everyone is ready for the transition. And offer training to ensure quick adoption and effective use of the system.
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Document Product Catalog and Configurations
List all product options and configurations for easy reference and selection.
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Set Pricing and Discount Rules
Define consistent pricing structures and discount rules based on your business needs.
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Create Review and Approval Workflows
Implement built-in workflows for smooth approvals, reducing bottlenecks.
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Ensure Seamless Integration
Work with your vendor to integrate CPQ with CRM, ERP, billing, and other systems for smooth data flow.
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Evaluate Scalability
Choose a solution that grows with your business, supporting new markets, products, and regions.
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Assess Vendor Support and Training
Look for a vendor with strong ongoing support and comprehensive training resources for your team.
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Test Before Launch
Check if the tool works up to your expectations and satisfies your business needs before going live.
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Evaluate Costs and ROI
Consider both upfront costs and ongoing expenses to ensure long-term value and ROI from your CPQ solution.
Once you have implemented the tool, keep monitoring and measuring the changes using metrics like:
- 96% Reduction in quote turnaround time
- Improvement in sales team productivity
- Reduction in pricing errors
- Increase in deal closure rates
Cincom CPQ for Scaling Your Sales Efficiency
Cincom CPQ is one of the most robust CPQ tools, specifically designed for companies with complex product offerings. It empowers businesses to tailor every aspect of their products and services to maximize revenue potential. Used by renowned brands across various industries, Cincom CPQ has proven its impact on automating and streamlining quoting processes, increasing efficiency.
It is designed to address complex sales challenges, such as:
- Slow quoting times
- Inaccurate pricing
- Inconsistent processes
- Manual proposal generation, and
- Product configuration errors.
It helps streamline the sales process of many fast-growth companies, including:
- Industrial Equipment Manufacturing
- Specialty Vehicles & Automotive
- Medical Devices & Equipment
- HVAC & Plumbing
- Aeronautic Manufacturing
- Power and Utilities
Cincom CPQ: The 7P Approach to Simplified Sales
Cincom CPQ transforms every part of the sales process, leveraging the 7P approach to make complex sales cycles more efficient, streamlined, and accurate.
1- Product Configuration: Helps customize products based on specific customer requirements, ensuring accurate configurations.
2- Precise Pricing: Ensures consistent, accurate quotes and pricing, eliminating human error and ensuring predefined rules are followed with advanced automation.
3- Polished Proposals: Generates professional, customized proposals without compromising branding, providing consistency in messaging across formats.
4- Process Streamlined: Seamlessly integrates with CRM and ERP systems, accelerating deal cycles and enhancing overall efficiency.
5- Personalized Configurations: Tailors each quote to meet the customer’s specific needs using guided selling workflows, particularly beneficial for manufacturers with complex configurations.
6- Platform Flexibility: Supports both cloud and on-premises deployments, ensuring flexibility and smooth integration into the existing tech stack.
7- Professional Services: Cincom’s expert team ensures successful implementation and continued optimization of CPQ, maximizing your investment.
Book a demo or consultation to learn how Cincom CPQ can streamline your sales operations and accelerate growth. Connect with our experts today!
Conclusion
CPQ is indeed an asset for companies to streamline their sales cycle for efficient, accurate, and fast deal closures. This automation and accuracy help to build customer trust and thereby improve the brand’s credibility with customers, which helps in business success in the long term. Adopting a robust tool like Cincom CPQ will help you achieve this by simplifying your complex configuration, pricing, and quoting process of products like vehicles, machines, and software products.
FAQs
1- How can a CPQ solution support scalability for my company?
A CPQ solution automates pricing, quoting, and product configuration, which helps manage increased complexity as your business grows. It ensures efficiency, reduces errors, and scales with your company’s expanding needs.
2- What are the benefits of implementing a CPQ solution early in the growth stage?
Early adoption streamlines the sales process, reduces manual work, and prevents bottlenecks as your company grows. It ensures faster, more accurate quotes and helps your team stay efficient and productive.
3- What features should I look for in a CPQ solution?
Look for product configuration, automated pricing, fast quote generation, CRM and ERP integration, and approval automation. These features will ensure accuracy, efficiency, and seamless workflows.
4- What is the ROI of adopting a CPQ solution for a fast-growth company?
CPQ solutions reduce errors, speed up quote generation, and improve sales productivity, leading to faster deal closures, more revenue, and better customer satisfaction.
5- Will CPQ solutions require ongoing maintenance or updates?
Yes, CPQ solutions need regular updates and maintenance to keep up with changing business needs, product updates, and pricing adjustments. Ongoing support ensures the system stays effective and aligned with your goals.
