The art of sales is a much discussed topic, especially among salespeople. Every step of the process from initial contact with the customer to the close of the deal is discussed, analyzed and rehashed. Techniques are proposed, pitfalls are identified, and deals are dissected, whether they result in a win or a loss.
One aspect of the process, however, is taken for granted: the creation of quotes and proposals. The process that’s in place to develop quotes is what it is inscrutable to sales, unchangeable, and opaque in many cases. It’s also a danger area for your deals, where mistakes are frequent, approvals can be slow in coming, delays are many and the seeds of customer dissatisfaction may be sown.
Because of the increasingly complex mix of products that vendors are offering, the manual approach to quote creation is becoming rapidly obsolete. What will replace it? CPQ solutions, which automate the process, make it much easier to propagate changes in catalog items and product descriptions, and automate the approval process to speed deals to conclusion and at the same time protect margin.
What is Configure Price Quote? Why do Organization need It?
Configure Price Quote is a somewhat simplistic name for the set of tasks that CPQ actually performs. At a high level, CPQ is a tool that automates many of the administrative tasks that sales reps and sales managers must do to close sales. In reality, CPQ provides a tool that helps the sales process at multiple points, and makes the buying experience better for the buyer, optimizes margin for the seller, and enables the sales rep to appear more knowledgeable and responsive. Here is a short description of the major features of a fully-functioned CPQ product:
Guided Selling
For complex sales, this tool is extremely helpful: with some input from the sales rep, CPQ can suggest next steps, up-selling opportunities and best practices in real time. The same technology that automates sales rules also automates selling workflows, and helps sales reps sell according to the needs of the customer based on past experience with similar customers.
Product Catalog and Pricing Guidelines
Companies using old approaches to developing proposals and quotes usually had a catalog and a pricing book one company had a 1000 page product book and a 575 page pricing book, for instance and reps had to manually use these documents to search for product numbers, product data and prices in order to build a quote. CPQ builds the data in these documents into the system and makes them easily searchable; quotes can then be built through a point and click basis, helping to eliminate the mistakes endemic in manual quote creation. Changes to the catalog can be propagated immediately, a major savings in time and expense from the change process needed for paper catalogs.
Product Configurator
This feature simplifies the quote process by helping to suggest products based on the type of sale new sale, upgrade, renewal and so on. Incompatibility between features can be flagged automatically, and sales reps can use side by side comparisons and product specifications to help buyers make the best decisions. Up-selling and cross-selling opportunities are automatically highlighted, so sales reps have the best options for increasing deal size served up to them just as they need them.
Document Production and Management
Of course, CPQ automates the production of proposals, quotes, license agreements and RFPs that’s one of the technology’s bread-and-butter capabilities. But it also helps sales find the content it needs during the sales process. Data sheets, diagrams, case studies and other content associated with a product can be called up and delivered to the customer as the quote is built. Sales doesn’t have to hunt through your website to find the content that can help tip a deal in your favor.
Automated Approvals
Your approvals aren’t given arbitrarily by your sales managers there are a set of rules and criteria that dictate which deals pass muster and which ones don’t. Why not automate those rules and criteria? Doing so builds speed into the process; automation means that quotes don’t sit on managers’ desks until they can get to them, so they can be approved faster. Customers are happier – they get what they need from you more quickly and managers get time back in their busy schedules. And if a quote doesn’t get an approval, sales reps can quickly get to the task of modifying it for re-submission.
Signs that show organization need CPQ
Adding technology to organization selling process is not an exercise that should be taken lightly. Responsible businesses read the signs and act when the time is right doing otherwise can mean lost opportunities (if too late) or lost investment (if done too early).
CPQ is a good example of this. Not every business needs CPQ it’s found a comfortable niche among businesses of a certain size in the area of industrial equipment manufacturing but its usefulness is being discovered by new markets (most notably, telecommunications, high-tech, life sciences and healthcare). How do you know if the time is right for you to make the move to CPQ? Here are six criteria to keep an eye on.
- Product complexity outstrips sales reps’ capacity to Keep Up
- Upselling doesn’t meet expectations
- Sales Reps are spending more time building quotes than selling
- Mistakes are compromising margins
- Margin takes a beating from discounting
- Deals die while proposals await approval
If your organization is experiencing any of the criteria above, reach out to us at sales@cx100.com
