CPQ, or Configure, Price, Quote solutions allow companies to quickly and accurately generate complex sales quotes for configurable products. Quotes created via CPQ software follow a predetermined set of rules, accounting for a long list of variables, like: quantity, customization, optional features, discounts, etc.
Even better, CPQ often works in tandem with other solutions, like CRM platforms or ERP programs, which provides integrated data and simplifies business operations.
Yet perhaps the most exciting thing about CPQ is its direct impact on revenue.
How CPQ Accelerates Sales
In traditional sales operations, a large part of a sales rep’s time is unfortunately spent on generating quotes and proposals, and following up accordingly. In fact, most sales reps spend only 34% of their time actually selling - the rest is tied up putting together pricing for potential customers.
CPQ solutions minimize the time sales reps have to spend doing things other than selling, and consequently, they are able to increase revenue by focusing on more critical things. In fact, according to a Salesforce report, sales teams have reported:
- 10x quicker quote generation
- 95% reduction in time for approval
- 30% quicker onboarding for new sales members
Thanks to these benefits, teams see immediate and impressive return on investment (ROI), one that is far faster than many other products can yield.
CPQ and Finance: Increasing Revenue Capture
While Sales is the obvious area impacted by CPQ, it’s just the beginning. Finance is another area of business where CPQ can increase revenue.
Most organizations spend a significant amount of time trying to forecast both revenue and expenses. Thanks to the robust data CPQ provides, financial forecasting is easier - and more accurate - than ever.
CPQ data provides specific performance metrics that shed light on all kinds of things: individual performance, product performance, specific departments and territories, and more.
In fact, CPQ can help businesses determine where products should be sold, like through specific channels or in specific territories. They can even use that data to determine why something is selling more effectively in one place versus another, and use the insights to make adjustments so it sells well in both.
CPQ can provide market and product insights, demonstrating if a market is viable and a product truly has great ROI, thanks to the ability to pull back and look at large-scale patterns. For example, a product may sell spectacularly, but if it’s costing a lot in warranty servicing, perhaps it’s not as profitable as it appears at first glance.
Thanks to CPQ, financial decisions and impacts are clearer than ever, providing businesses with easy ways to assess, evaluate, and make informed decisions.
How CPQ Enhances B2B Customers' Buying Experience
In addition to the benefits to your sales and finance teams, CPQ also provides a significantly improved customer experience, increasing customer satisfaction and loyalty.
Thanks to CPQ’s functionality, it provides quick and accurate quotes to customers, something that has historically been a pain point for many users. Rather than waiting days or sometimes weeks to receive customized quotes, customers receive them quickly and without the error-laden configurations that cause frustration and distrust. Even complex configurations are simplified with CPQ, making it a simple experience for customers to get the information they need.
CPQ also allows for businesses to provide personalized offers, with pricing unique to each customer and even specific product recommendations that fit the customer’s particular needs. CPQ leverages AI to provide spot-on suggestions, ensuring that sales teams can deliver relevant options to customers.
Understanding CPQ's ROI
Unlike more traditional solutions, CPQ has an immediate impact on revenue, and that’s something customers get excited about. After all, who doesn’t love revenue growth, especially when CPQ takes most of the hard work out of the equation?
CPQ builds a much faster path to ROI than many other solutions because it directly contributes to revenue by better equipping sales teams and allowing them to focus on relationships; providing robust financial insights to make well-informed business decisions; and offering a superior customer experience that ensures satisfied customers who keep coming back.
If you’re interested in learning more about CPQ solutions and how they can impact your organization’s bottom line, contact the team of experts at Object Edge today.