How CPQ Pricing Works

CPQ
Salesforce.com

CPQ, or configure price quote, is a type of software that does exactly what it implies: It configures price quotes for your sales team, removing guess work and errors. In an age where everyone has shorter attention spans than goldfish (truly, according to Google researchers) and instant gratification is the norm, if a quote can’t be instantly offered, customers start looking elsewhere. They might even be comparing price quotes on their smartphones while talking with your sales crew.

But how does CPQ pricing actually work? How can the software drum up the most accurate of quotes for every prospect instantly—all without inefficiencies or bugs? It’s a problem that’s plagued sales teams for years, and a lot of businesses aren’t sure how to handle it. First, let’s start with “configure.” Every prospect, product/service and deal is different.

Customize Away

Customers want and expect customized service, and that includes the price they pay for negotiable goods and services. We’ve been customizing our cars, our homes and our playlists. Choosing which features are most important to fit into a budget, and which can go, is the MO for many buyers. Configuration can be dictated by both wants and needs. For B2B sellers, needs are tackled with one of a kind combinations of both products and services to suit buyers.

If you’re not customizing, your competition certainly is. Configuring your offerings requires flawless data record keeping and real-time information on competing deals and discounts. Sales team members are able to configure that final price quote based on both of these factors, as well as any business regulations and customer needs. There’s plenty of room to play, but within boundaries and while being fully informed.

The Bottom Line

Not very many businesses sell goods at the full list price every time. There are avenues for savings like bundle pricing, special pricing and volume pricing. Some sales teams are given permission to negotiate to a certain figure. Knowing the discount rules, bundle pricing and simply tracking the current pricing can be a nightmare. When discounts are wrongly applied, it can lead to a snowball effect that destroys revenues. (Plus, it’s simply embarrassing when a customer gets a wrong price quote!).

CPQ software stays on top of pricing for every product and service in your inventory. Quotes are created with prices that are consistent and it automatically searches for any discounts. You can even integrate advanced, complicated pricing rules to take care of volume discounts, pre-negotiated contact pricing, channel/partner pricing, and the percent of total subscriptions price. With CPQ software, prices are always accurate and maximized for the best deal.

Quote Me on This

The quote is the turning point in a negotiation. For sales members, it’s the big opportunity that needs to be done well and fast. The quote helps shape the business’ reputation and needs to be presented professionally. CPQ software helps with this, instantly distributing a streamlined, pro quote. Sales members can send it via email, complete with an e-signature option if they like. Of course, hard copies are also available. The quote aspect of CPQ software is designed to work on every device and platform.

The software auto pulls all products and pricing, linking the quote process together in one neat bundle. Consistency is a must for businesses. Most importantly, CPQ software was designed with the users in mind. Sales team members aren’t expected to be software gurus and their time is incredibly precious. A user-friendly interface, extremely shallow learning curve, and 24/7 technical support ensures CPQ software is easy to use for every member of the sales team from entry-level employees to managers. For many in the sales circle, once they use CPQ software, they can’t imagine ever returning to the “good (but slow) old days.”

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