The Role of CPQ

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Reducing the cost of sales is crucial for businesses aiming to maximise their revenue and profitability. One effective method to achieve this is through the use of Configure Price Quote (CPQ) software.
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Statistics by HubSpot and SalesInsightsLab.com:

Sales reps spend just 34% of their time actually selling, with much of their non-selling time spent generating quotes, proposals, and gaining approvals.

That’s a lot of time not spent selling anything, isn’t it?

CPQ software can significantly improve this by automating these tasks: Users have reported:

• 10 times faster quote generation,
• a 95% reduction in approval time, and
• a two-fold increase in the speed from quote to cash.

CPQ is a powerful sales tool that enables companies to provide accurate pricing for any given product configuration scenario. It considers optional features, customisations, quantities, and discounts, allowing sales reps to quote prices quickly and accurately. CPQ software is used by companies having various types of products and sales offerings: configure-to-order (CTO), make-to-order (MTO) and engineering-to-order (ETO). After closing a deal, CPQ software ensures that no information needs to be manually entered into other software such as ERP systems.

By automating all these manual tasks and avoiding errors, CPQ improves efficency enormously and reduces sales costs. By combining the costing and proposal development processes, CPQ software enables sales, engineering, marketing, and finance teams to work together more effectively, reducing (even completely eliminating) the chances of errors and miscommunications. It also provides a more consistent and streamlined customer experience as customers receive accurate and timely quotes, and sales reps can focus on building relationships and closing deals.

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CPQ in short:

• Accurate Pricing: CPQ software provides precise pricing for any product configuration scenario.
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• Cost Reduction: Automates manual tasks, streamlines the sales process, and reduces errors.
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• Enhanced Collaboration: Centralizes quoting and costing processes, improving teamwork and reducing miscommunications.

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Now that you understand the role of CPQ and its benefits for your company, stay tuned for our next article to explore exactly how CPQ achieves these results in practice.