Best CPQ Software
Buyer's Guide
Choosing the right software to streamline your sales process is easier said than done. Just like smartphones, social media and online shopping, CPQ software has been rising up the ranks as a winning bet.
If you’re aiming to increase the sales effectiveness, volume and efficiency of your business, investing in a CPQ platform is a great option.
Studies show it takes non-CPQ users 73% more time to generate a quote or proposal, and it’s been proven that sellers who can create accurate and complete quotes faster win the deal at least 60% of the time, if not more.
Read on to get the scoop on CPQ software, deployment, benefits, features, price considerations and trends.
Executive Summary
- CPQ software helps businesses configure products, set prices and generate quotes.
- Using a CPQ solution helps deal with complex cases, make smart business decisions and improve ROI.
- Choosing the right software is difficult but possible. It’s important to make the right choice to fit business needs perfectly.
- What Is CPQ Software?
- Deployment Methods
- Primary Benefits
- Implementation Goals
- Key Features & Functionality
- Advanced Features To Consider
- Trends
- Software Comparison Strategy
- Cost & Pricing Considerations
- The Best CPQ Software
- Questions To Ask Yourself
- Questions To Ask Vendors
- In Conclusion
- Product Comparisons
What Is CPQ Software?
CPQ software is a sales tool enabling companies to quickly and accurately define product prices while considering many variables. Grouping these variables helps you configure products or services optimally, fix prices according to costs, competition and economic factors and quote the absolute best price possible.
Repetition is important when picking up new skills, but offering customers ample scope for configuration and customization is the key to retention. However, that shouldn’t come at the cost of accurate pricing.
Create professional, automated quotes following algorithms and rules, ensuring error-free pricing. CPQ tools determine the price based on certain factors, including quantities, customizations, incompatibilities, discounts, optional product features and multiple revenue types.
CPQ platforms collaborate with ERP, CRM and other technologies, offering accuracy and integrated data.
Deployment Methods
Everything is on the cloud nowadays, including CPQ software deployment. However, you can make a case for on-site servers. Depending on your industry and needs, you can determine the right option for your company.
Cloud
The cloud makes it easier to keep your wallet intact while springing for new software. Essentially, your data and software are hosted by the vendor and other companies who opted for a subscription-based model. It saves you moolah, but the downside is limited customization and modification of the server environment. This is a good option if you’re a smaller or mid-sized company looking for a starter system.
On-premise
Everything is in-house with an on-premise server. You’ll host and manage your data and software. Although it comes with a hefty one-time fee and additional IT costs, you’ll have better data security and flexibility. Ideally, you’d need IT expertise and sufficient hardware, which hikes up costs.
Primary Benefits
Shorter Sales Cycles
A robust CPQ tool helps you speed up sales processes using streamlined configuration and automated quoting, leading to reduced sales cycles. For B2B companies, shorter sales cycles mean improved productivity.
Enhanced Sales Performance
Sales reps can strategically identify promising cross-sell and upsell opportunities at once via CPQ software. The user-friendly ordering process encourages customers to complete their orders, improving conversion rates and leading to better sales team performance.
Increased Deal Values
Customers can easily choose customization options from the CPQ interface, and greater customization means higher deal value. Sales reps can recommend customers to purchase add-ons or accessories, based on the available opportunities, contributing to increased deal sizes.
Higher Customer Satisfaction
A CPQ solution helps sales executives achieve their CRM objectives. They can receive notifications for contract renewals or product upgrades and utilize the cross- or up-sell opportunities accordingly. The platform helps them quickly and accurately recommend the best products, services or bundles for each customer, ensuring higher customer satisfaction and retention.
Reduced Training
With CPQ software, you don’t need to worry about training sales reps thoroughly — they won’t need to learn the model-specific features. Instead, they can follow an intuitive product configuration process to gather all the essential knowledge. They can also avoid awkward sales conversations and expensive configuration mistakes
Implementation Goals
Before you initiate the buying process, you’ll need to have clear goals in mind. Map out what you want CPQ software to do for your company. Having only a vague vision leaves you susceptible to costs that weren’t on the agenda.
| Goal 1 Quicker Turnaround Times | The sooner you respond to client requests for proposals and quotes, the better. Reduce time spent on manual tasks and waiting for approvals with automation and workflow management. |
|---|---|
| Goal 2 Better Margins | Sunk cost effect is real, and it affects consumption patterns. Price optimization, discounts, intuitive upselling, and cross-selling increase deal values and margins. |
| Goal 3 Fewer Errors | Sending the wrong pricing in a quote feels like missing the final penalty in a World Cup. Utalize a centralized database with real-time price updates, set discount margins and rules to make it easy to get all your ducks in a row. |
| Goal 4 Customer Retention | Getting clients is one thing, but keeping them is quite another. Contract management and pertinent recommendations make renewals and repeat purchases a seamless experience. |
Key Features & Functionality
| Scheduling and Dispatching | An integral feature, this lets you book jobs, tasks and events, as well as view the real-time locations and availability of field staff. You can also filter and search job orders and tasks as well as track the workload and progress of each staff member. |
|---|---|
| Product Configurations | Most CPQ platforms are equipped with product configuration, allowing buyers to visualize the final product. You can generate datasheets, proposals and 2D or 3D drawings. While 2D configurations use still images, 3D presentations offer a more realistic representation of the customer’s final order. |
| Project and Quote Management | Integral to CPQ, this helps you create precise, professional and customizable quotes with quantity configurations, direct chat and interactive pricing tables. You can use templates, replicate orders by saving product selections and proposals, and track sent quotes through follow-up emails. |
| Pricing | Determining the right price of products or services is one of the key responsibilities of CPQ. This feature helps you calculate and test pricing based on rules, constraints, discounts and commissions. You can streamline lead-to-order processes with optimal costing solutions and develop personalized price sheets, material bills and more. |
| Reporting | Reporting allows you to see where the customers are dropping off during the ordering process, and track which customizations work best for them and how successful your discounts are. You can use the insights derived from reporting to optimize processes moving forward. |
| Invoicing | You can create and share customizable invoices either using pre-built templates or drafting your own templates. Or, create and send invoices in bulk. Share invoices for timely payments, automate payments for recurring jobs by saving credit card details and follow up on past due invoices. |
| E-Signature | Enable customers to digitally sign documents on the go and receive electronic certificates after every signature. Most CPQ systems follow major compliance rules thoroughly. Monitor document activities via mobile devices with embedded audit trails for additional security. |
| Client Hub | Enable your clients with a self-service portal through which they can check and approve quotes, track appointment details, pay invoices, print receipts and share feedback. |
Advanced Features To Consider
| CAD Viewer | Manufacturers know the importance of a CAD viewer for customizations. Create models for production and sales with 2D or 3D CAD viewing. Use geometric search to view similar jobs and save time creating duplicates. |
|---|---|
| Contract Management | f you use subscriptions, licenses or recurring agreements as a part of your pricing model, subscription management will keep your customers on the hook. View existing services and contract status, make amendments to terms and get eSignatures and approvals. |
| Mobile App | Get back to clients on the go. Configure products, view pricing information and create quotes with the mobile suite. |
| AI Capabilities | Contrary to what the Matrix and I, Robot led us to believe, AI isn’t the enemy. AI increases deal sizes with cross-selling and upselling recommendations and discount guidance. |
Trends
As the demand for customization increases, CPQ’s star is on the rise. A report by Global Industry Analysts shows the CPQ software market is set to be worth $4.5 billion in 2027, up from $1.6 billion in 2020.
The only constant is change. And that’s especially true with new software. Look out for these CPQ trends going mainstream in the next couple of years.
Increased AI and Automation
Time is money. Automation helps you save time, ergo money, by speeding up sales processes. As AI becomes affordable, you’ll be able to perform complex analysis and eliminate manual tasks leaving you more time for important interactions.
Self-service
When was the last time you wanted to spend an exorbitant amount of time talking to a sales rep before you made an online purchase? With instant gratification becoming the norm, customers want more control over choices and quicker responses. Instant RFQ and quotes make life easier for you and your clients.
Machine Learning
The need for speed in sales responses can never be understated. Machine learning application takes historical data to automate product decision-making and pricing strategies. Save time with suggestions on pricing configurations that otherwise take hours to calculate manually.
Risk Management
If the last few years have taught us anything, it’s that we’ve got to be prepared to pivot. Quote responses should factor in variables like supply chain issues, price volatility and failure rates. Additionally, recommending alternatives will build trust with customers.
Software Comparison Strategy
A CPQ solution, when chosen wisely, eliminates a lot of sales hurdles that might have been slowing down business processes. It enables departments to collaborate and make perfect sales quotes, and ensures enhanced efficiency.
As one study shows, exhaustive business processes consume 64.2% of sales reps’ days, and 50% of buyers choose the vendor that responds first. This clearly indicates the pressing need of investing in a CPQ system to make sure your business is the one to snag those buyers. But the question is how to choose the right CPQ tool for you!
A nice starting reference is to check your competitors’ preferences. Look into their experiences with different industry-leading solutions and how they’ve been leveraging those platforms. Also, check with the organizations who cater to the same target audience and follow similar workflows to those of your business.
However, the final deciding factor is cross-checking if the solution you’re eyeing effectively fulfills all your business needs. Don’t forget to prepare a requirements list that clearly defines your organization’s needs. While compiling this requirements list, consider incorporating opinions and recommendations from other team members, especially those using the tool. Then, compare potential vendors against your requirements list to see which ones stand out.
Cost & Pricing Considerations
Determining the budget for a CPQ software is probably the trickiest part of the entire process. You must consider a few factors such as business size, the number and type of user licenses you require, deployment method and the kind of features you would need most — some of these might require purchase of add-on packages.
It’s also vital to check about scalable pricing well in advance so that you can add or remove users whenever needed, without leading to any confusion or unforeseen charges.
Evaluate any upfront fees and monthly installments. Consider the direct costs such as installation, license, training and support, and data conversion. Additionally, account for indirect costs such as consultation fees, IT staffing and essential system upgrades. Don’t forget to cross-check with the vendor if there are any hidden costs, one-time fees or payment processing fees.
Best CPQ Software
It’s human nature to want the best. If you’re looking for the Ferrari of CPQ systems, we’ve got you covered. Although we’re certain no one knows your business needs quite as well as you, our analysts have provided a great starting point.
Here’s a brief introduction to all the products, including who they serve and what their key offerings are.
Conga CPQ
Conga CPQ is a scalable solution created to increase profitability with the help of AI and guided selling. Searchable configuration, an advanced pricing engine and expedited quoting workflows optimize sales processes. Centralized data and automated quote-to-cash process help you respond to clients faster.
Conga CPQ Quote Layout.
Salesforce CPQ
Salesforce CPQ is a cloud-based platform aimed at providing accurate pricing and quotes with any degree of configuration. Automated quote renewals and invoices save time. An intuitive pricing engine, centralized data and visibility into customer plans reduce errors.
Salesforce CPQ Product Configuration.
Oracle CPQ
Designed for medium to large-scale businesses, Oracle CPQ optimizes sales processes with built-in intelligence. Respond to client requests using its pricing support, dynamic configuration and document designer. Other features include a multi-language module, eSignatures and end-to-end integration.
Oracle CPQ Process Workflows.
SAP CPQ
SAP CPQ is a cloud-based platform ideal for omnichannel selling. It is used to streamline product configuration, pricing and quote fulfillment. Users can define product and pricing rules, generate visualization in real-time and set up automated workflows. Other helpful features are AI selling, multi-currency and language availability, and online catalogs.
SAP CPQ Quoting.
Infor CPQ
Infor CPQ uses visualization to improve the purchasing experience. It is a cloud-based solution with 3D interactive model creation, augmented reality and 3D CAD assemblies to enhance product configuration. Ideal for manufacturers, you can convert quotes to orders and generate manufacturing information.
Infor CPQ Mobile Capabilities.
Questions To Ask Yourself
Looking inward doesn’t need to be something reserved for a therapy session. Once you understand what your business needs, you’ll put yourself in a better position to select a software solution. Before you talk to vendors, ask yourself the following questions:
- What are our business requirements?
- What’s our budget?
- Have any of our competitors invested in CPQ software?
- What features are crucial and which we can skip?
- How will the software add value to our existing operations?
- Will this software meet our future needs?
- Does this software integrate with our current ERP, MES and CRM systems?
- Will a rules-based configuration work, or do we need something constraints-based? Is our product catalog expanding?
Questions To Ask Vendors
Consider preparing a questionnaire to ask the vendor about their services and software. Asking these questions along the way will not only help avoid add-ons but also narrow down your search. Dot all your i’s and cross all your t’s by asking vendors the questions below:
- Do you offer migration or implementation support?
- Which solutions does the platform integrate with?
- What are the offerings of the basic plan?
- Are there any hidden costs or separate costs for add-ons?
- What kind of training and support is offered?
- What are the AI-based capabilities? Do you have upselling, cross-selling and pricing recommendations?
In Conclusion
Manually updating prices, creating quotes and configuring products is like using a landline when smartphones exist. CPQ software makes light work of time-consuming administrative tasks and optimizes your sales processes.
It’s not all fun and games. Picking the right software can seem like participating in an interactive episode of Squid Game — with less drastic consequences. Streamline your choices with our free requirements template.
We hope this guide prepares you for your quest toward successful CPQ implementation.
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