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Top 5 Benefits of Using CPQ Software for Manufacturing Companies

Whether you manufacture out-of-the-box products, like conveyor belts for factory lines, or custom technology, like unique pieces of agricultural machinery constructed for a specific farm, CPQ can help. It offers a single source of truth that ensures product and pricing information are accurate and updated.

It can also help your sales team save time by reducing the steps in your quote process and automating quoting. This means your company can close more deals faster.

1. Real-time Pricing

In the past, manufacturers who offered configurable products struggled to price orders accurately. Each time a sales rep needed to change a pricing rule, the process was complicated and time-consuming.

CPQ software eliminates these difficulties by automating the entire quoting and ordering process. This software considers product specifications, production costs, and optional features to calculate prices based on all relevant factors.

Manufacturers can then use this data to create price lists, discounts for specific accounts, and tiered prices for bulk orders. This helps companies compete with competitors by providing customers with the right offer at the right time.

Having this information at your fingertips also makes onboarding new sales team members more accessible, as they can learn quickly and efficiently about your company’s products and services. 

Additionally, generating accurate quotes in less time gives salespeople more bandwidth to explore cross-selling and upselling opportunities to boost revenue without significantly increasing operational resources. This is how the Configure Price Quote software program can empower manufacturing teams to achieve growth goals.

2. Easy Access to Data

As a manufacturing business, you may have complex products with thousands of options and configurations. This makes off-the-shelf CPQ software solutions less suitable for your needs. CPQ software explicitly designed for your manufacturing company is a powerful tool that delivers impressive results and benefits.

With a CPQ solution built for your industry, you can connect sales with the back-end systems that manage pricing structures, product inventory, and availability. This integration enables sales reps to create quotes that reflect current prices and inventory levels. This reduces delays in quoting and ensures that the products you sell are within your production capabilities.

Manual quoting processes can consume sales bandwidth and limit the number of deals you can close each year. CPQ software frees up sales bandwidth to enable you to increase revenue without significant operational changes. The result is a much more profitable sales team and an improved customer experience.

3. Reduce Errors

Manufacturing is a world of variables and add-ons, making configuring and pricing products difficult. If your teams rely on manual processes, they can easily make errors in calculations or unapproved upselling that can eat into your profit margins.

CPQ software ensures that all quotes are accurate and complete before they are sent to customers. It automates pricing based on BOM characteristics, production costs, optional features, and other factors to help you reach your margin targets. This eliminates the need for engineers to be involved in every quote, saving time and money.

In addition, CPQ software validates all configurations for accuracy based on business rules. Any incoming orders will be error-free, and production will be completed on time due to incorrect specifications or Bills of Materials (BOM). 

CPQ also allows your operations team to predict upcoming raw material needs using this data. This will enable them to plan and reduce the impact of unforeseen delays on quotas and revenue. This feature is invaluable for manufacturers who deal with a high volume of shipments.

4. Automated Pricing

Using CPQ software to automate pricing can be very effective and reduce the number of human errors while increasing sales volume and profitability. However, it’s essential to understand how these systems are programmed before deploying them.

With CPQ, users (salespeople or customers) can configure products with an intuitive visual product configurator embedded on the seller’s website. They select various options, from dimensions to materials and add-on services. The CPQ system calculates prices in real-time and generates documents without manual intervention.

The automated pricing feature of CPQ makes this process extremely efficient, as it eliminates back-and-forth between engineering and sales teams and enables the creation of accurate, high-quality quotes. This, in turn, helps to boost sales and customer loyalty.

Manufacturers who utilize CPQ technology to automate pricing can quickly adapt their prices per market conditions and business goals. This allows them to increase their average weekly sales rapidly while sustaining a new level of growth in the long run.

5. Integrations

In manufacturing, countless product variables and add-ons can affect the cost of a specific configuration. For this reason, CPQ software is built with the ability to support rules and restrictions for each unique product. This can include wholesale bundles, hierarchical discounts, free add-ons with specific cart sizes, and dynamic inventory reflection to avoid overselling products.

Moreover, the streamlined process that CPQ provides allows sales teams to generate custom quotes quickly. This eliminates the need for engineers to review each order, saving on costly production delays.

Additionally, CPQ integrates with your ERP system to automatically manage product configuration and pricing information. This streamlines the entire workflow and reduces errors.

Ultimately, the benefits of CPQ software are endless for your business. Manual quoting challenges eat up your sales team’s bandwidth, but with a CPQ solution, they can easily convert qualified leads into closed wins. 

Furthermore, you can ensure accuracy by automating the quoting process and providing guardrails for your product configurations, increasing customer satisfaction and revenue opportunities.

Alex Carey
Alex Careyhttps://www.thetechnoverts.com
Alex Carey is working as a Content Marketing Specialist at The Technoverts. He loves to write and share content related to the latest technical research. He is also a soccer lover.

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