![How Configure, Price, Quote Software Can Make You Sane Again [6 CPQ Benefits]](https://www.panorama-consulting.com/wp-content/uploads/2023/03/CPQ-benefits.png.webp)
With the rise of e-Commerce in the late 1990s, companies started viewing their business processes from a different perspective. Their tolerance for inaccurate quotes and lengthy sales cycles greatly diminished, and they began looking for technology solutions to solve their pain points.
Enter Configure, Price, Quote (CPQ) software. CPQ software has been around for several decades, but its mainstream adoption started with the rise of e-Commerce. The shift to an online sales model led to a mad dash for modern technology solutions.
Today, we’re sharing six CPQ benefits. Find out what today’s CPQ solutions are capable of and how you can leverage this software to transform your sales process.
6 CPQ Benefits You Need Right Now
CPQ technology is used by companies across a variety of industries, from manufacturing and distribution to healthcare and financial services. It’s offered as a standalone solution that you can integrate with your existing systems, and it’s also offered as a native component of ERP software. Regardless of your industry or your business systems strategy, here are some benefits you can expect.
1. Faster Sales Cycle
Customers are always looking for quick solutions. When a customer receives a quick response, they are more likely to trust the company and proceed with the deal.
CPQ software automates and streamlines manual tasks, such as product configuration, pricing, and quoting. Sales reps often spend a significant amount of time on these tasks, but with CPQ technology, they can focus more on building relationships with customers and closing deals.
The 2024 ERP Report
88.5% of respondents said they deployed or plan to deploy AI at their organization. Learn about AI adoption and other ERP trends by downloading our latest report.
2. Accurate Quotes
Inaccurate quotes can cause customers to lose trust in a company.
CPQ software ensures that quotes are accurate by providing a single source of truth while automating the pricing, discounting, and approval process.
This allows companies to offer flexible payment options and bundle relevant products and services. With personalized and accurate quotes, customers become more confident in their purchasing decision, and they know they are getting a fair deal.
3. Improved Profit Margins
CPQ software provides real-time pricing guidance, including visibility into margin impact, so sales reps can make more informed pricing decisions, resulting in higher margins.
Additionally, CPQ software can provide smart suggestions about relevant products and bundles, which enables sales reps to achieve higher margins by upselling and cross-selling.
If you want to improve your company’s profit margins, it’s important to document your unique business requirements before evaluating a CPQ solution.
4. Better Visibility Into Sales Performance
With real-time visibility into the sales pipeline, sales managers can monitor the performance of their team to identify bottlenecks in the sales process and take corrective action.
The real-time insights provided by CPQ technology include key performance indicators such as revenue, profit margins, and product mix. These insights enable data-driven decisions about how to optimize the sales process.
5. Enhanced Customer Experience
With CPQ technology, customers can configure products to their specifications and view transparent pricing and discounts.
This is possible because CPQ software automates the creation of complex product configurations. Customers or sales reps can view a 3D model of a product while selecting various features and accessories. The software then generates a detailed bill of materials.
6. Improved Manufacturing Processes
When a product is configured using CPQ software, the system may create new part numbers to track the various components and configurations. The new part numbers are included in the bill of materials and used to track inventory and manage the manufacturing process.
Creating new part numbers for custom products ensures accuracy and consistency in the manufacturing process.
For example, let’s say a customer wants to purchase a customized laptop computer that includes a high-end graphics card, a larger hard drive, and additional RAM. The sales team can use CPQ software to configure the laptop with the required features while generating a unique part number for the finished product. The software may also create new part numbers for the graphics card, hard drive, and RAM modules, as these components are not standard parts used in the base laptop model.
The Benefits of CPQ Software are More Compelling Than Ever
Over the years, CPQ software has continued to evolve, offering a wider range of features and functionality. At the same time CPQ benefits have evolved, as well. In the 1990s, few would have guessed that 3D models would ever be part of the equation. But here we are, more than twenty years later talking about digital twins and contemplating 50 different colors for RV awnings and ten different mounting options.
To learn more about the benefits of today’s CPQ software, contact our ERP selection consultants below.
