The intense competition in B2B sales increases the demand for specialized and tailored products. The one-size-fits-all approach is not suitable in such a space because buyers need products tailored to their needs. And this can bring along pricing challenges for sellers.
If you sell the same product to all your customers, pricing would be a breeze. But B2B SaaS companies may require sales personnel to customize and quote pricing based on customers’ product demands.
That’s where a game-changing solution comes into play, revolutionizing how businesses handle complex sales processes. It is called CPQ.
If you aren’t sure about CPQ meaning in business, it’s a process that simplifies the quoting process for configurable products. It saves time, reduces errors, and simplifies the sales experience for sales reps and their customers.
This blog post will explore why CPQ can be a huge time-saving solution for sales reps and customers.
#1. Faster sales cycle
A sales team may have a lot to do when closing the lead. Confusion and assumption about pricing add to the complexity, providing potential clients with impractical expectations and markdowns. Wouldn’t it be fantastic to streamline the sales process with the help of advanced technology that reduces expenses and enhances your return on investment?
This is precisely why adopting a CPQ system is a wise decision. CPQ minimizes the squandering of valuable time for sales reps since it offers automated quotations rather than focusing on trivial administrative duties.
Research from Aberdeen Group has shown that CPQ adopters decrease their sales cycle by 13%, bringing down the average sales cycle from 4.68 months (for non-CPQ users) to 3.42 months (for CPQ users). The same research also shows that non-CPQ users engaged in 7.1 discussions per transaction, while CPQ users required only 6.6 discussions per transaction.
That said, CPQ enables tailoring quotes immediately, which can significantly enhance customer trust. Custom quotes provide accurate, consistent, transparent pricing and product configurations, eliminating errors and miscommunications. In the long run, this fosters confidence in the business’s ability to efficiently deliver tailored solutions.
Ultimately, using CPQ will minimize manual tasks, reduce errors, and provide accurate, real-time information to customers. This way, it gets easier for sales reps to close the sales cycle faster (compared to not using CPQ).
#2. Optimized performance
A robust CPQ solution offers a substantial customer experience by empowering the sales team to provide intricate product configurations, streamlined pricing, and impressive proposals. It helps sales personnel to provide the best-suited product at the perfect price and time to push the sales momentum across channels.
Performance optimization is all about time and cost saving, and CPQ software offers the same in the following ways:
Faster quote generation: The sales reps can generate customer quotes, automate choosing the right products, and price them with CPQ. This saves time for both the sales team members and the customers receiving quotes faster, which enables quick decision-making.
Accurate pricing: Leverage the rules-based system to calculate pricing with accuracy and consistency. This eliminates the need for sales team members to manually calculate prices, reducing the risk of errors and saving time.
Customization: For instance, sales reps can customize product catalogs to include only the products and services relevant to the customer’s needs, set up pricing rules and ensure that the quotes are accurate and competitive. Moreover, it is possible to customize the settings within the CPQ software to meet each customer’s demands, from the order quantity to possible discounts, and even consider past purchases. This way, CPQ software helps sales reps to work more efficiently, with more accuracy and confidence, ultimately leading to higher sales performance and increased customer satisfaction.
Streamlined approval process: Sales team can use CPQ software to streamline the approval process for quotes, as managers can easily review and approve quotes online. This eliminates the need for manual approval processes, which can be time-consuming and error-prone.
#3. Increased sales efficiency
While the sales reps would try to focus completely on their customers, plenty of tedious business processes go along with selling without customer involvement. Over 70% of a sales rep’s time is spent on administrative tasks, leaving only 30% of their time prospecting and connecting with customers.
CPQ eases the administrative tasks with configuring, pricing, and quoting to free up more time. This helps the sales reps to focus on customer interactions.
Dynamic pricing: CPQ software allows sales teams to apply dynamic pricing rules. It considers factors like discounts, promotions, and regional variations. This ensures pricing is optimized and consistent across all quotes, making the sales process more transparent and efficient.
Integration with CRM and ERP systems: It is possible to integrate CPQ solutions with CRM (Customer Relationship Management) and ERP (Enterprise Resource Planning) systems, providing a seamless data flow between them. Such integration provides sales reps access to the most up-to-date customer and product information. This can enable them to make better, more informed decisions.
Enhanced analytics and reporting: CPQ solutions typically include robust analytics and reporting capabilities. It allows sales teams to track key performance indicators (KPIs), monitor sales trends, and identify areas for improvement. Such a data-driven approach helps sales teams to optimize their processes and make more informed decisions, ultimately driving sales efficiency.
Robust automation: Usually, the monotonous tasks of sales reps involve product configuration, calculating accurate prices, and generating customer quotes. But, CPQ can help automate these tasks to reduce the time they take to prepare customer quotes and proposals. This means they can spend more time selling activities, such as engaging with customers and closing deals.
#4. Saves time on product configuration
Another significant benefit of CPQ is that it saves time on product configuration. Gone are the days when sales reps manually configure products and calculate prices. This process was time-consuming and prone to errors.
Since CPQ can automate the process, sales reps can configure products by choosing the desired options from a drop-down menu, saving time and minimizing errors.
Here are a few other ways CPQ saves time for sales reps and customers.
Guided selling: Sales reps must assess real-time and historical sales data to suggest interesting products. CPQ tools leverage guided selling to identify the right product configurations based on the customer’s needs and preferences. This reduces the time spent on manual product selection and ensures the optimal solution for the customer.
Centralized product catalog: CPQ systems can consolidate product information, including options, features, and pricing, into a single, easily accessible location. Such centralization allows everyone in the sales department to quickly find and configure the right products, eliminating the need to navigate through multiple sources of information.
Real-time configuration validation: As sales reps configure products, CPQ systems automatically check for compatibility and ensure the chosen configuration is viable. This not only saves time by preventing the need for manual validation but also reduces the likelihood of errors and customer dissatisfaction.
CPQ is a game-changer for the sales team since it can simplify and automate many of their jobs. Such automation across the configuration, pricing, and quoting of products can take the time and effort sales reps require to create accurate quotes and proposals. Moreover, it also provides customers with a more personalized and efficient buying experience.
Its ability to enable guided selling coupled with accuracy and consistency makes CPQ a must-have tool for businesses looking to stay competitive through efficiency.