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5 Reasons To Make Pricing Guidance Part Of Your Quoting Solution

What you need is Smart CPQ: CPQ with Price Guidance. In this informative new tip sheet, you’ll learn how to use this solution to provide a rational and defensible starting price, build your sales team’s confidence in price negotiations, improve the sales experience for your prospects, and reduce price variance and defend against price erosion.

Realize Your Potential Tip Sheet Reasons To Make Pricing Guidance Part Of Your Quoting Solution Accelerated advancements in technology are continuing to shorten product lifecycles as newer, more capable products quickly make existing products obsolete or inferior. Simultaneously, your biggest and best customers have come to expect solutions tailored to meet their specific needs. To meet the highly variable needs of customers without sacrificing customer experience, many companies are adopting CPQ (configure, price, quote) solutions. This technology helps salespeople navigate the complexity of an ever- changing product catalog to put together best fit quotes for their customer’s unique requirements quickly and accurately. However, just getting the right products on the quote isn’t enough to stay competitive in high tech. To put together the best fit deal for both your company and your customer, you need to look beyond traditional CPQ capabilities. By adding price guidance into your quoting process, you’ll improve the effectiveness of your sales team and maximize the lifetime value of your product portfolio. Five reasons incorporating price guidance into your CPQ is a no-brainer: 5 5 Reasons To Make Pricing Guidance Part Of Your Quoting Solution Providing context for deals: When one of your sales reps goes into a pricing negotiation with little more than gut instinct, the initial price offered is likely to be too high, too low or lowered too quickly. All salespeople have had the experience of coming in too high and losing the business, or coming in too low and leaving money on the table. Salespeople are most effective when equipped with a rational pricing strategy that allows them to negotiate in a range that makes sense for their business and the customer. With pricing guidance, sales reps know when they have flexibility and when they don’t, and have confidence that the prices being offered are realistic, fact-based and defensible. Increasing confidence in negotiations: To win deals at the prices your organization needs, reps must have confidence in their pricing position. Often, the buyer has the most comprehensive and up-to-date market research, and thus more power in the negotiations. When a sales rep doesn’t have confidence in their price position, the first thing they do is back off the initial price. This signals the customer to keep pushing until they find the lowest possible price. With pricing guidance integrated into CPQ, however, the salesperson’s position is strong and clear. Reps have the confidence to stand firm with their prices as they are backed up by hard data. Your sales reps are also able to spend more time on ensuring they communicate the value your solution provides because they’re confident the pricing is data-driven. This approach helps to change the sales conversation from haggling over the lowest price to helping the customer internalize the full value they receive from your solution. Improving the sales experience for prospects: Combining CPQ with pricing guidance allows reps to quickly deliver the right price for the right product, improving the experience for their prospects. Using CPQ’s product configuration capabilities, your sales rep has the right tools to quickly create the best offer to meet their requirements. Pricing guidance then supplies the sales rep with a data-driven price for this configured product that meets your business goals while also being within the customer’s affordability range. 3 2 1 5 Reasons To Make Pricing Guidance Part Of Your Quoting Solution Building trust in customer relationships: Since CPQ with pricing guidance allows your company to provide exceptional personalization and responsiveness, it also helps you build trust and strong relationships with your customers. This personalized, data-driven sales process makes customers more comfortable with accepting your sales proposals; improving your win rate while reducing sales cycles. For them, you become the only vendor they trust to provide the solution they need at the price that works for them. Defending against price erosion: As teams adopt pricing guidance, the variance in product and solution pricing lessens. Price guidance adoption kicks off a positive cycle where prices become more consistent and defensible. With fewer discount swings, fighting the headwinds of price erosion becomes a manageable undertaking that maximizes the lifetime value of your products and solutions. In today’s business environment of mass customization, adopting a CRM solution is a good first step toward improving sales effectiveness — but CRM alone isn’t enough. That’s why many companies are adopting CPQ technology as a way to meet the growing demand for configured products and services. Now, it’s time to take your sales effectiveness to a new level by adding pricing guidance to your CPQ solution. Pricing guidance does more than just come up with a price; it integrates your policy and your process, allowing your organization to capture the five benefits outlined above. Is there any evidence that the adoption of this technology and taking these five steps will have a positive impact on your business? Our experience is companies taking this approach are seeing 100 to 300 basis point improvements in their margin. For best results, these tools should be seamlessly integrated into existing CRM systems, with a consistent style and functionality that make it easy for your organization to adopt. This way, salespeople will work in a familiar environment, reducing the learning curve and making it easy for them to adopt the new capabilities. Deploying CPQ capabilities provides a significant business benefit, but adding pricing guidance means your sales team is now armed and ready to work more effectively with your customers and become that trusted partner they can’t live without. 5 4 Ready to learn more about using CPQ and pricing guidance to improve your sales process? Visit the PROS Blog for expert insights and guidance. About PROS PROS Holdings, Inc. (NYSE: PRO) is a revenue and profit realization company that helps B2B and B2C customers realize their potential through the blend of simplicity and data science. PROS offers cloud solutions to help accelerate sales, formulate winning pricing strategies and align product, demand and availability. PROS revenue and profit realization solutions are designed to allow customers to experience meaningful revenue growth, sustained profitability and modernized business processes. Copyright © 2016, PROS Inc. All rights reserved. This document is provided for information purposes only and the contents hereof are subject to change without notice. This document is not warranted to be error -free, nor subject to any other warranties or conditions, whether expressed orally or implied in law, including implied warranties and conditions of merchantability or fitness for a particular purpose. We specifically disclaim any liability with respect to this document and no contractual obligations are formed either directly or indirectly by this document. This document may not be reproduced or transmitted in any form or by any means, electronic or mechanical, for any purpose, without our prior written permission. To learn more, visit pros.com. 012916
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