When was the last time you lost a customer because you weren't fast enough?
When you have a lot of leads, it can be hard to give buyers quotes and prices quickly. Rushing through pricing isn’t a great option because you might make mistakes—and pricing mistakes can be expensive. It would help if you had software that lets you configure, price, and quote.
A CPQ can help you as a modern manufacturer:
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Real-time pricing and quotes are available for products.
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Provide customers with 3D images of modifiable products.
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Automate all internal processes that result in sales.
You'll learn everything you need to know about CPQ and how it can improve processes' productivity and efficiency in this guide.
What exactly is Configure, Price, Quote (CPQ) software?
Configure, price, quote (CPQ) software is a tool that makes it simpler to configure, price, and generate a quote for a product. At least, that’s what a CPQ does in its most basic form. As explained below, the latest CPQ options offer various additional tools to support these three primary functions.
Configure
Modern CPQ products offer a built-in visual configurator that lets buyers view 3D, AR, and VR product configurations. The visual configurator provides the chance to study the product before requesting a quote or placing an order.
A great way to make a lasting impression is to provide customers with an immersive visual experience. Research shows that 65% of the population learns and retains visual information the best. Additionally, buyers will clearly understand the product's final appearance with a visual configurator, reducing purchase anxiety.
Using a visual configurator also shows your customers that you are a tech-savvy manufacturer who keeps up with the latest trends and technology.
Price
Sixty-six percent of businesses surveyed by the CX Accelerator in 2022 stated that customers are less patient when interacting with agents or service teams than in 2021.
We can see from this information that satisfying your customer's need for speed is crucial. Mistakes, however, can be costly—pricing yourself out of the competition means losing business; underpricing can reduce your profitability. When you have many leads to nurture, how do you combine speed and accuracy? Using CPQ.
CPQ helps automate the pricing process. When a buyer or your sales rep initiates a pricing request for a configuration, the CPQ use its powerful rules engine to compute a price instantly, enabling them to move quickly to the next step in the sales process.
Quote
Quotes take a lot of time from sales reps. Translation? Sales reps are making quotes while buyers have to wait. If a competitor sends in a quote before you, you might lose the sale altogether.
On the other hand, a CPQ makes this wait time almost nonexistent. Buyers can quickly get all the documents and details necessary to present the proposal to their buying committee and get buy-in.
What to expect from CPQ software in the 21st century
Modern CPQ tools are full of features that significantly affect how efficiently a manufacturer works. From visual selling to automated internal processes, modern CPQ software can redefine the way your business operates. Let’s take a look.
Visual Selling
Gartner research shows that by 2025, digital channels will be used for 80% of B2B sales interactions. Static images won’t be good enough to beat the competition. You need something that distinguishes you and makes a buyer's time with you stands out. That’s where a CPQ’s visual configurator can help.
Visual selling gives the buyer an all-around experience. Complex product configurations can be difficult to understand using a static image like a photograph. But if you have a visual configurator, buyers can see your product in 3D, which sets you apart from competitors who only use product descriptions and stock photos.
Dynamic Pricing
If you manually figure out a price, customers must wait days, especially if you sell complicated items. CPQ removes this waiting period and gives buyers a price in seconds, accelerating your sales cycles. It also helps get rid of pricing mistakes made by people.
The newest CPQ products do more than figure out a price right away and make sure it is correct. They factor in internal discounts, promotions, and external data like materials, supply costs, and market demand to calculate a price that’s most likely to convert under current conditions.
Buyer-Friendly
A CPQ lets buyers and sales reps access configuration information whenever and wherever they need it.
For this, you need a CPQ that can work with eCommerce. When you integrate the CPQ with your eCommerce website, buyers can access the visual configurator, select a configuration, and get a price themselves in a few minutes—and without your help.
Thanks to the visual configurator, KBMax CPQ users see an average 40% rise in conversions. Viewing configurations on your website also makes it easier for global buyers to order from you.
24*7 Cloud-Based System
The best CPQ software on the market is available in the cloud, so sales reps and customers can get the information they need on any device when they need it. Cloud-based systems are also great for collaborating, sharing data, and communicating with your team members and external partners.
A cloud-based system also costs less to run and maintain. And your vendor will ensure the system is bug-free and available as long as you continue your subscription.
Rules and Limitations Without a Code
The rules engine is the brain of a CPQ system. The best CPQ tools offer a no-code rules engine you can configure without writing a single line of code. Rules can be made by business users without the help of IT or outside agencies. This makes it easier to launch new products and respond quickly to changes in the market.
Automate Internal Operations
A report from McKinsey shows that automation can boost productivity worldwide by 0.8% to 1.4% per year. Your competitors might already be automating their workflow, and if you’re looking to get started, investing in a CPQ is a great first step.
CPQ helps you automate different parts of your process. When the buyer selects a configuration, the CPQ captures the details and generates a quote. Once the buyer completes the purchase, the CPQ automatically creates production documentation, such as CAD drawings, CNC cut sheets, assembly instructions, and a bill of materials. The CPQ also relays information to other tools you’ve integrated, such as your CRM and ERP.
Your engineering team won't have to spend as much time making CAD drawings by hand. Sales reps save time because they won’t have to create quotes manually. Also, you can cut down on administrative work by moving information automatically between business tools.
Should you buy CPQ software?
Nucleus Research says that for every dollar you invest in CPQ, you get back $6.22. This is a 622% return. CPQs deliver these returns through a combination of efficient processes, larger deal sizes, and faster sales cycles.
So it's clear that investing in CPQ will help you save money. However, you also stand to gain on other fronts. For example, you'll keep customers longer and ensure they're happy if you answer their price questions immediately. You’ll also establish yourself as a leader who uses best-in-class business technology, which reflects favorably on your product offering.
