As a VAR, MSP or IT reseller, you may not often have the bandwidth to focus on business development or streamlining sales processes. Your sales teams probably are juggling between meeting prospects, strengthening existing customer relations and creating sales quotations. Chances are, a lot of their time that ideally should be spent on lead creation or business development is spent at their desk grappling with multiple excel sheets.
If this scenario sounds familiar, then a CPQ tool is what you need to accelerate your quotation process and free your sales reps from cumbersome tasks allowing them to focus on customer acquisition and retention.
- What is CPQ?
- How Does CPQ Software Work?
- The Main Advantages of CPQ Software
- 6 Benefits of Implementing CPQ Software
- Does your VAR Business Need a CPQ Tool?
- What You Get With VARStreet’s CPQ Software
- Advanced search engine: An advanced search engine allows sales reps to find products within seconds despite a huge catalog. Parametric search shortens the time taken to find and add products to quote.
- Integrated shipping and tax calculation: Users can add saved customer shipping addresses, and freight charges are auto-calculated based on pre-set rule-based. Auto tax calculation further ensures no mistakes are made, and the quote integrity is maintained.
What is CPQ?
CPQ, or configure, price, quote, is an automation tool used by VARs, MSPs or IT resellers to automate a part of the sales creation process enabling sales reps to create accurate quotes for complex and configurable products quickly.
Top of the bat, CPQ software can help you:
- create accurate quotes for complex products,
- build customer relationships,
- integrate with your existing distributor network’s product catalog,
- reduce revenue leakage
- eliminate errors in pricing
- generate important reports to improve the visibility of your quoting process and sales pipeline.
While CPQ software has been available for decades, the latest innovations have supercharged sales processes in tandem with ERP software, CRM applications and integrations with other business management applications, aligning disparate systems and processes ensuring integrated data and accuracy.
CPQ software can be preprogrammed with a set of price rules based on your business policies and customer pricing to automate price calculations for configurable products.
How Does CPQ Software Work?
To understand the workings of CPQ software, let’s break each component down.
IT and office supply VAR businesses have many configurable products, customized solutions, services and experiences which also depend on the requirements of individual customers, especially for enterprise VARs selling to medium to large businesses. Implementing a CPQ tool automatically configures these products, also showing cross-sell and upsell suggestions.
Configurable products add a layer of complexity to pricing. CPQ software automatically calculates the prices of configured products based on the price rules set by you. This eliminates the risk of human error in pricing complex products, reducing losses for you and saving time for your sales reps who can move on to the next step in the sales process faster.
Once you have configured the products and priced them accurately, you need to send the quote to the customer.
CPQ software has many pre-designed templates that allow you to create error-free quotes quickly, personalize them and send them to your customers in no time at all. This quick turnaround time is important because customers approach multiple VARs for quotes, and if your business does not respond within 24 hours, you risk losing out to competitors.
The Main Advantages of CPQ Software
Manual quoting processes hinder the timely delivery of quotes, especially when the prospect requires options or configurable products. Sales reps have to go through various spreadsheets looking for price rules, calculate prices, and then create the quote.
CPQ software streamlines this process across the organization by clearly establishing pre-programmed rules bringing uniformity, clarity and transparency to your quoting process.
A CPQ tool takes into account every possible configuration, price, discount, customer catalogs and pricing, etc., and offers the sales rep creating the quote options, which they can add to customized templates, to create an accurate sales quote.
CPQ software also has approval workflows, so the quotation can be automatically routed for approvals, further accelerating the quote creation and sending times.
Aids collaboration to create accurate sales quotes
When CPQ implementation is done right, it allows cross-functional teams like sales, procurement, accounts and finance to collaborate seamlessly. Integrated systems involve the entire organization and deter sales teams from selling configurations that are not possible logistically, financially or legally.
It allows IT SMEs (subject matter experts) to weigh in and create product configurations or bundles that are the best possible solutions for your customers by entering rules into the CPQ system, which guide your sales teams to become solution-oriented.
CPQ applications benefit the entire VAR business, not just sales teams allowing seamless communication and removing informational silos enabling your business to become customer-centric.
An approved quote puts into play a series of further business processes like:
- Generating an order.
- Invoicing the customer.
- Receiving payment.
- Balance sheet entries and debits.
- Inventory management.
- Fulfilling orders.
The accuracy of the quote affects all the above events and departments. A CPQ tool links all these departments through tight integrations with existing business applications and reducing errors.
A robust CPQ application integrates with ERP systems connecting sales and operations, reducing operating costs and ensuring smooth and transparent business operations, keeping every department in the loop.
Increases sales team productivity
The State of Sales report by Salesforce states that only 34% of a sales rep’s time is spent selling, prospecting and building relationships with customers. The remainder on cumbersome administrative tasks which can very easily be automated, giving your sales teams additional time to meet prospects and customers to actually sell, and generate revenue for your business.
A CPQ solution with tight integrations with CRM applications enables sales staff to access important customer data, previous orders, buying history, preferences, etc., helping them make meaningful conversations with prospects or customers, which in turn builds credibility and establishes your business as a trusted advisor.
Transitioning a customer through the sales pipeline is easier and faster because of the automated rules and approval workflows boosting the customer’s confidence in your VAR business.
CPQ applications improve the efficiency of your sales staff by allowing them to focus more on selling and eventually contributing to the growth of your VAR business.
A CPQ tool empowers your sales team
The above advantages of a CPQ tool instil confidence in your sales teams, enabling them to address prospect or customer requirements perfectly. Configurable products are difficult to price manually, and sales reps spend a lot of time generating accurate quotes for these products. The automation eliminates room for error, and your sales reps can trust that the solutions they are offering a customer are the best possible solutions at the best possible price backed by formal rules and accurate pricing engines. They can be confident that the price quoted honors margin rules and drives revenue to the business.
Once a quote is created, the integrated approval workflow further reduces the sales cycle, allowing them to close deals quickly without sacrificing accuracy. This automation enables your sales reps to appear more professional and increases their authority and credibility.
6 Benefits of Implementing CPQ Software
1. Lowered risk
When the quoting and pricing accuracy improves, room for errors like quoting incorrect prices, products or incompatible product configurations reduces. This saves you money and time and reduces the risk of customers leaving you.
2. Accelerates the sales cycle
Wasted time costs money. Automation will positively impact company-wide productivity, and your sales teams can get back to customers quickly and close deals much faster.
3. Increase in average order values
Upsell and cross-sell suggestions while creating quotes allows you to increase the average order value by recommending products that align with the customer’s preferences or needs.
4. Introduce new products, configurations and bundles quickly
CPQ software like VARStreet has integrations with 45+ distributors product catalogs. You can easily select and add new products or create configurations and bundles, and the prices will auto-update across all your applications. Expanding your product offerings with VARStreet takes just a few clicks!
5. Enhanced customer service
An overall streamlined business will help you serve the customer better. Reduced errors, accurate orders, faster cycles and consistent interactions enhance the customer experience. Unified data across departments enables all your team to offer excellent customer service.
6. Grow your VAR business
All the advantages and benefits mentioned above will contribute to the growth of your VAR business. Implementing CPQ software will help you scale up easily and expand your business bringing in more revenue and profits
While these are some of the many advantages a CPQ tool can bring to your VAR business, you may wonder if your business needs CPQ software in addition to any existing tools you may be using.
Does your VAR Business Need a CPQ Tool?
Ask yourself the following questions to determine if you can benefit from CPQ implementation:
- Does your VAR catalog include complex and configurable products like IT solutions, for instance, with complicated and dynamic prices?
- Do you have customers on differentiated and complicated pricing models?
- Are your sales reps still creating quotes manually via spreadsheets?
- Are there errors in quoting and configurations?
- Does someone from your sales team review the quotes before sending them to customers?
Did you answer yes to any of these questions? If you did, then it is time you consider implementing a CPQ solution.
Still undecided? Read When Should a Company Consider a CPQ Software
When CPQ software, like VARStreet’s CPQ, is deployed and implemented correctly, it offers an excellent return on investment (RoI) and the potential it offers your VAR business is transformational.
What You Get With VARStreet’s CPQ Software
- Robust product configuration: A product configurator that supports comprehensive configuration options allowing VAR users to configure products and services by selecting bundles, creating complex products, kits and assemblies that consist of multiple parts, customizing products according to customer requirement constraints, options, preferences, etc. by accounting for compatibility and availability.
- Pricing rules and adjustments: The pricing engine determines complex prices based on rules, hierarchies, customer price structures and product configurations. Users can also override prices based on discounts, markups, etc.
- Purchase history and open contracts: Accessible data around a customer’s previous buying behaviour, current contracts, etc., allows sales reps to offer solutions that best suit a customer’s requirement and preferences.
- Quote sharing and sending: Sales reps can quickly send a quote to customers via email, make it available on their portal or share a URL.
- Integrated approval workflows: VARs can add approval workflows in their quotations based on any condition to accelerate the quote to cash process.
- Guided selling: A step-by-step configuration wizard to help sales reps choose the right products and services and offer automatic upsell and cross-sell suggestions to help them configure the best product offerings.
- eSignature: VARStreet’s CPQ tool integrates with DocuSign so that quotes can be approved and signed digitally by customers.
- CPQ on eCommerce stores: Your online customers can log in to their storefronts on your eCommerce website and select and configure products themselves.
- Distributor integrations: VARStreet’s CPQ tool comes with integrations with over 45 IT and office supplies distributors’ product catalogs with over 7 million SKUs available for adding to sales quotes.
- Real-time price and inventory: Our integrations with distributors enable you to view the real-time price, inventory, and distributor promotions in real-time.
- Attachments: PDFs, contracts, videos, product guides, images, etc., can be attached to quotes.
- CRM integration: Seamless integration with our FREE CRM streamlines operations and allows you to access and auto-update customer data across systems.
- Reports and analytics: VARs can set metrics and generate reports and analytics data like quoting cycle time, quote acceptance rates, close percentages, revenue generated, etc., to make smart business decisions backed by data.
- Cloud-hosted CPQ solution: VARStreet’s CPQ software is cloud-hosted, which means you can access it from anywhere. The implementation is quick, and your CPQ solution can be deployed within days.
A perfect CPQ solution works silently in the background, making the sales process more effective and profitable through automation, allowing your sales teams to focus exclusively on your leads and customers and offer a customer-centric approach to sales.