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8 Features of CPQ that Benefit Sales & Manufacturing Companies

Updated on January 6th, 2023

Configure, Price, Quote (CPQ) provides 100% accurate quotes, automates and speeds up configuration of products. It assures increase in sales/revenue, enhanced customer satisfaction with features of upselling, cross selling, price optimization and 3D visualization.

Business Need

In today’s customer-driven market, consumers demand instant quotes and visualization of products as per specifications to help them make faster decisions.
It has also become imperative for manufacturers to survive in a competitive selling space. Closing deals faster and meeting the high demands of customized products while increasing sales and productivity are the need of the hour.

CPQ software provides a “five times greater year-over-year revenue growth rate” and minimizes “the complexity of the quoting and proposal process by minimizing the people and functions involved”.Source: Aberdeen

Solution

An interactive sales acceleration software like CPQ, enables B2B manufacturers to provide quick, 100% accurate quotes to their customers. Real time inputs on product availability, margins and delivery schedules further add in enhancing customer experience.
Price optimization by formalizing rules and pricing, increasing sales/revenue while allowing the sales teams to custom design or configure solutions for customers from diverse product groups, are key benefits of CPQ.

According to Gartner, by 2019, 40% of B2B ecommerce sites will use a CPQ tool to “calculate and deliver product pricing dynamically.”

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8 Features of CPQ that Benefit Sales & Manufacturing Companies

Real-time price and quote for specific configurations as per customer requirements makes CPQ an imperative for accelerated sales and enhanced revenues. CPQ enables customers to modify specifications and update price while recommending multiple options to help customers make smarter decisions.

Accuracy & Speed

Price Optimization

3D Visualizations

Real-time Visibility
with Integrations

Upselling & Cross Selling

Multi-platform Support

Reporting

Guided Selling

1100% Accurate and Faster Quotes

The Automated Quoting and Pricing Management feature of CPQ ensures that quotes are updated automatically as and when customers configure their orders. In addition, the pricing management ensures that pricing updates automatically get applied system-wide to create accurate and faster quotes within a few seconds.

100% Accurate Quotes offered 98% Faster

Mounting customer demands put pressure on a leading steel door manufacturer in the US to shorten quote times while increasing accuracy. Hitech CADD Services provided end-to-end CPQ solutions that brought down the quoting process from 4 hours to 5 minutes, positively affecting the sales process and customer experience, while achieving shorter lead times.

According to data from Aberdeen Group’s Research Report, companies that use CPQ have 57% greater margins than the companies who do not use CPQ.

2Price Optimization

CPQ provides insights into the behavior of potential customers in response to how they react to different prices by analyzing large sets of data. It uses calculations to envision how demand differs at different price points and combines that data with cost and inventory levels to create a lucrative price point for that product or service. Manufacturers, then use this analysis to determine the pricing, promotions, discounts etc. thereby providing the customer with the most optimum pricing available.

Automated Price Optimization

VanAire, USA, a leading Environmental Solutions and Engineered Valve Automation Hardware company, relied on the CAD department to gather dimensional data, manually type it and design the kit using the latest policies determined by market analysis, which was time consuming. With SolidWorks and DriveWorks, they designed kits based on current rules, pricing, current Valve and Actuator dimensions and customer expectations that resulted in a 3D model and shop drawings that were generated automatically and guaranteed to be correct as they are based on VanAire’s current rules, pricing, discounts.

“This whole process now takes less than two minutes. The end result is a 3D model and shop drawings that are generated automatically and guaranteed to be correct because they are based on VanAire’s current rules.”

Tony Lambert, Vice President, VanAire, LLC

33D Product Visualization

All customers want to see what they are purchasing. 2D and 3D product configurators allow the customer to configure products as per their requirements, and enables them to view the product visually in 3D. This provides a more accurate depiction of their order with enhanced purchasing experience.

95% Accuracy offered with 3D Models

A leading furniture manufacturer needed to digitize their designs in editable format and generate 3D CAD models from 2D for future needs while gaining access to all product development stakeholders. Hitech CADD Services converted the 2D images to 3D CAD assembly and part models and submitted finalized CAD files with standard layers, attributes, custom properties and exploded views. This enabled the client to convert and view designs in 3D models and all designs passed prototype tests by nearly 100%.

4Real-time Visibility with Integrations

CPQ is equipped with an advanced rules engine that removes any product combination, pricing, bundling or calculation errors. It formalizes rules and pricing over all departments based on an organization’s pricing structure and database and integrates with ERP and CRM systems of a company, providing Real Time visibility. The built-in CPQ intelligence ensures that quotes created contain the suitable product mix for business necessities as well as customer wants, eliminating the burden on sales staff to manually create and configure products, without worrying about addressing product complexities such as knowing if, part X is compatible with part Y or Z.

CPQ Closed the Gap of CRM

An Aircraft Interior Manufacturing in USA, had a data management system where they had to fetch data manually from ERP system as components were stored in an excel file on a local system that was accessible only by a single user. Hitech CADD Services created an intuitive user interface, which was shared with different teams for improvement in flow process. The dashboards for different team to work on included the “Top Down” approach, which enhanced the visibility of Order status/Progress in different departments’ viz. sales, planning, engineering and manufacturing, closing the gap of CRM.

Upselling and cross selling with shorter sales cycle

5Upselling & Cross Selling with Shorter Sales Cycle

Upselling and Cross Selling in CPQ shortens the sale cycle by enabling customers to self-configure products as per their requirements, give instant quotes while providing relevant product options to help customers make smart decisions.

Upselling Feature Increases Sales Productivity

A B2B Company in U.S. struggled to sell services and accessories, which affected the company’s revenue, as cross selling and upselling were too time consuming.

Based on previous transactions, CPQ provided information at the speed of conversation in a simple, streamlined way, enabling sales reps to see whether customers who bought a certain base model would be likely to buy a particular extended warranty and specific option or accessory enabling a dramatic increase in sales productivity.

“The average sales cycle for non-CPQ enabled companies is 4.68 months which is reduced to 3.42 months (33%) using CPQ.”

According to data from Aberdeen Group’s Research Report, companies that use CPQ have 57% greater margins than the companies who do not use CPQ.

6Multi-Platform Support

CPQ solutions enable sales personnel to easily access orders, quotes, pricing on a multi platforms on any mobile friendly interface. This multi-platform support feature of CPQ increases the accessibility for the sales department so that they can make any required updates or tend to customers from anywhere at any time.

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7Reporting

Make smarter business decisions by merging sales and finance with complete visibility across the customer lifecycle from quote to retention. Reporting, an essential feature of CPQ allows companies to see where in the ordering process customers are losing interest, current customizations that are popular, what promotions and discounts have worked etc. Using these important insights, companies can make improvements to their ordering experience, increasing their sales efficiency and revenue.

Reporting Enables Informed Business Decisions

Redox, a leading name in healthcare, struggled to comprehend their sales pipeline, the estimated value of sales opportunities and whether their sales numbers were reliable.

Salesforce CPQ was used to establish a consistent sales process and optimized workflow that provided important company metrics. By creating intuitive procedures that matched Redox’s sales process, they were able to see consistent reports that matched their sales goals enabling all levels of the organization to be confident in the company’s sales data, and help make quick sales decisions.

8Guided Selling, Comparison of Products for Customers

Customized quotes with suggestions of options as well as guided selling that also allows comparison of products, all within a few minutes while enabling customers to adjust the product as per their needs, enhances customer-purchasing experience. The increased access to customers leads to better customer retention.

Recommendations

CPQ is the preferred “go to” tool in the current market as it offers a better understanding of customer needs and assists them to act quickly, bringing greater precision, accuracy, speed, and improvement in every aspect of the sales cycles; from product pricing to complex product configurations.

CPQ integrates with ERP and CRM systems, providing the technology edge to the estimation process.

Manufacturers today are opting for CPQ as it provides features like upselling and cross selling which helps the sales personnel to provide various options to a customer, get more business by helping the customer make smart decisions.

Modern technology tools like integrating AI (Artificial Intelligence) with CPQ have emerged which makes business analysis much easier, faster, and cost effective, along with real-time transparency.

As technology advances, CPQ users now have access to mobile-enabled CPQ tools that enable sales reps to create quotes as per their customer’s needs, anywhere and at any time!

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