In a world where there seems to be an endless option of tools, functions and software, it is easy to feel slightly confused and overwhelmed. But don’t despair. Let us help you figure out what CPQ really is and how it can benefit you and your business.
CPQ stands for Configure Price Quote, and it is a digital sales tool that helps sales associates efficiently create complex quotes for their customers. CPQ is used for creating offers for products where you need to adjust (Configure) and set the price (Price) every time you create a new quote (Quote).
The CPQ software has been used by larger manufacturing companies for a while, but in recent years, interest amongst smaller companies in various industries has taken off. I.e. SaaS-companies, or consulting firms, that have a volume- or user-based pricing and offer several different options, resulting in an endless number of combinations that can be offered to the customer.
Several CRM-suppliers have started to integrate limited CPQ functionality by offering the option of choosing products and volumes and then creating a business opportunity in the CRM. But to calculate a correct price and create the quote, tools such as Excel or Powerpoint, or similar tools, are used. Numbers are often copied and pasted between the tools increasing the risk of human error.
What goes into a quote and how it is designed is usually a decision that includes multiple stakeholders in an organization. Your Head of Sales needs the quote to be as clear and selling as possible to encourage the customer to pick your offer instead of competing offers. Your CMO oversees the content and that the design follows the company’s graphic profile. Your CFO needs the pricing to be correct and to be in line with the company’s rules on margins and billing options. When implementing a CPQ software, it is crucial to involve all these roles so you get it right from the start.
Integrating the CPQ software with your business tools (ERP), client database (CRM) and e-signing tool is necessary for creating an efficient workflow for your sales team. By automatically collecting information on product, pricing and the customer from other systems, the sellers can instead focus their time on creating a customized quote. Simply having to spend less time on administration.
According to Gartner, the CPQ category is growing and estimated to grow with 20% per year in the coming years. An obvious sign that current users find the software to be of great value and that CPQ is spreading to more industries and companies of all sizes.
If you are curious to see how a CPQ software can help you, let us know and we would be happy to go over how it can be of value for your organization.
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