If you are in the mechanical industry, chances are your company offers complex products, such as motors, conveyors, or other industrial machinery. With complex products, there comes even more complex quoting and pricing. And don’t let us start on the trail of errors that come with hundreds of product variations and configurations.
Your customers are expecting to craft complex products easily and fast – they don’t want to waste their time waiting for responses to their quotes. They expect the best possible customer experience, and you need to make sure to meet their expectations. Most of the customers may leave your business after just one unpleasant experience. To avoid that, your business should focus on offering your customers what they want.
The era of spreadsheets and endless rows of data has ended for many companies. Using a Configure, Price, Quote tool, customers can easily pick the desired product and its specifications, get their quote and pricing quickly, and upgrade their buying experience. Want to know how your company can benefit from this solution? Follow this CPQ guide.
What is a CPQ solution?
CPQ is a short-term for Configure, Price, Quote. It is a user-friendly tool for creating a standardized quoting process and order automation for your business. It is designed to shorten the quoting process by allowing sales reps to change their focus from administrative tasks to closing deals and becoming solution sellers.
CPQ software reduces the duration of the quoting process by reducing quote response times, increasing sales win rates, and, most importantly, driving revenue growth. Quotes are tailored to your customers because they design their own products, which also lowers the risk of errors being made by miscommunication.
CPQ is often integrated into ERP and CRM systems to manage the whole selling process easily. A CPQ tool combines pricing rules, product configurations, customer discounts, bulk orders, and logistic fees into one solution that automates the quoting process.
During configuration, your customers choose the specifications of their product. This process also addresses incompatible products or product variations, which helps minimize quoting errors, costly returns of the wrong product, and time spent by sales reps waiting for other departments to advise on possible product combinations.
But even though a CPQ solution is a sales tool in the first place, there is a lot more to quote automation. CPQ software is not just about customization; it’s also about efficiency. Let’s see what each CPQ segment helps you with and its main benefits.
C is for Configure
In the context of CPQ software, configuration is the process of adapting products or services to align with a customer’s specific needs. CPQs are designed to interact with customers, guiding them to the desired features in their custom product.
The CPQ tools with an online 3D product configurator take your configuration game further. It offers your customers the best experience by completely visualizing their selected product. Most of the customers prefer automated self-service. Using an online configurator means your customers don’t need to wait for sales reps to answer their questions.
The configurator offers customers transparency throughout the ordering process, and customers receive real-time quotes. They control the process by updating the price while configuring products. Also, by offering your customers the ability to use the configurator, you make their vision a reality.
Exchanging information about the desired product over the phone, email, or in person can sometimes lead to misunderstandings and errors, which can cause unexpected costs and potentially lost customers. An online configurator is perfect for your company—it saves time and money!
P is for Price
Companies that offer customizable products can’t have a set price because they can go from underpricing to overpricing, both of which are risky for the business. Businesses that are still manually pricing their specific products have slower turnaround times and many errors in their quotes. Mistakes in pricing can be trouble, especially if you don’t notice them on time.
CPQ solution allows you to set rules for your pricing. You can set the base price for each product, and additional features are automatically calculated during configuration. That way, your customers can get customized prices based on the selected product. Moreover, you can choose which visitors can see the prices of the configured products. For example, customers need to register to access pricing.
You can also apply special discounts and bonuses for your existing customers, which empowers value-based pricing. With CPQ’s pricing structure, your sales reps can quickly understand pricing, increasing efficiency and profit.
Q is for Quote
For each quote, the CPQ solution generates a document that contains all the information about products or services your customers want to purchase, including contact information, prices, terms and conditions, and blank panels for dates and signatures.
Your sales team saves time by automating and standardizing administrative tasks. The quoting process goes from hours to minutes! Your customers can immediately get their quotes approved. The quote-to-production process is faster and more accurate, mainly because your configurator already has all the required data – there is no need for additional approvals from other departments.
Benefits of CPQ solution
In today’s fast-evolving business environment, Configure, Price, Quote (CPQ) solutions are essential for upgrading sales processes and improving customer satisfaction. These solutions automate and optimize the configuration of products, pricing strategies, and quote generation, enabling businesses to respond to customer inquiries with accurate and tailored quotes.
Here are some of the most important benefits of CPQ solutions:
-
Increased sales efficiency and accuracy
As your company automates the configuration, pricing, and quoting processes with CPQ, your sales team significantly reduces their time on administrative tasks. Errors are minimized, which makes your quotes accurate and up-to-date with your pricing across all channels.
-
Better customer experience
Your quick quotes improve customer experience by reducing waiting times. The option of customized online configuration will leave lasting impressions on your customers.
-
Growth of revenue and saving of costs
CPQ tools enhance the ability to cross-sell and up-sell, helping you increase the average deal size. They also lead your sales process to deal with closures faster, boosting overall sales volume.
CPQs reduce your need for additional administrative support and allow your sales team to focus on high-value activities.
-
Better data and market insights
You can quickly get insights into sales performance, quote-to-order ratios, and other key metrics. Your team can forecast future sales and see what products perform best. CPQ remembers buying patterns and preferences, helping you adjust your strategy.
With the CPQ tool, your business can quickly adapt to market changes, demands, and new opportunities.
-
Improved integrations and collaboration
CPQs can usually integrate with CRM and ERP systems, which makes communication between departments much easier and more transparent. By integrating your CPQ with CRM, you can get a better view of your customer’s history and preferences to create more personalized and effective sales strategies.
-
Adaptability and flexibility
Your CPQ tool can accommodate your business needs, whether you have increased product complexity or a larger sales team (or both). CPQ solution easily adapts to your business needs. CPQs have scalability that allows them to handle increasing quote volume.
-
Easy sales training and onboarding
CPQs provide a step-by-step sales process, which helps you onboard your new sales reps and ensure that they are aware of best practices and company policies.
-
Less administrative tasks and more conversion rates
Using the CPQ tool, you are automating administrative work to generate and manage quotes, which means less paperwork for your sales. Your quotes are error-free and are more likely to bring you to conversion.
Implementing a CPQ solution can revolutionize your sales processes. It provides an excellent experience for both your employees and your customers. By automating the configuration, pricing, and quoting processes, you minimize errors and improve the speed and accuracy of your responses. That makes your customers loyal and satisfied. CPQs can help you make strategic decisions and explore your market, ensuring you stay competitive in a rapidly changing industry.
If you are considering a CPQ tool after reading this guide, you can check out our cloud-based solution, zipCPQ. It is designed to empower businesses in the mechanical industry. With zipCPQ, customers can easily craft their desired products and receive accurate, personalized quotes in minutes.
Don’t let your customers leave because of outdated work methods—implement zipCPQ to boost your revenue and deliver the best customer experience.
Discover how zipCPQ can transform your sales by scheduling a demo anytime!
