When should you not use Salesforce CPQ?

When should you not use Salesforce CPQ?

Salesforce Sales Cloud has long been the CRM System of choice for sales teams looking for easy-to-use, customizable CRM software. However, Salesforce Sales Cloud doesn't offer much in the way of Quote-to-Cash (QTC) automation. For that, you need Salesforce Configure-Price-Quote (CPQ.).

What is Salesforce CPQ?

Your business is starting to grow and your top salespeople are selling great. They have generated many leads at an event and some are already even converting.

But now what?

The next logical step is to make an offer, but making offers can be time-consuming. Studies show that today's salespeople spend only 34% of their time actually selling. The rest is a lot of administrative work: quoting, data entry and closing. This keeps your salespeople away from customers, often preventing them from achieving annual sales goals.

As a result, sales managers look for IT solutions to save time. The more time they spend on administration, the less time they have to generate new leads.

This is where CPQ solutions come in handy.

CPQ, or Configure, Price, Quote, is software that helps companies create accurate quotes. It provides a streamlined process. Salesforce CPQ is a powerful sales tool that helps sales teams streamline the entire process. QTC process, from proposal generation to contract management. However, Salesforce CPQ is not for everyone and can be costly to purchase and implement in an organization. There are a few situations where an organization may not need or be able to justify it.

Why you might not need Salesforce CPQ.

Your company offers only a few standard products

CPQ is best for companies with hundreds and thousands of products and services. If you only have a few products in your catalog, you really don't need a CPQ solution. Generating quotes for a few standard items is generally pretty fast.

Products require no configuration

It's right there in the name. Configure-Price-Quality. If a company keeps it simple, CPQ does not add value and is difficult to justify the cost. CPQ technology excels at complicated configurations and pricing structures, like selecting options for a car or computer. Selling generators with many different fuel and power options? CPQ is perfect for that. But if you only sell one standard generator, for example, and the customer only has to choose between a black or yellow frame color? Then you probably don't need CPQ.

You don't have to make quick offers

Suppose you are working in an industry where the sales team does not need to produce quotations quickly. Then you don't need a CPQ solution. Salesforce CPQ helps generate quotes from a large number of options in a fraction of the time a human can with fewer errors.

Budget is tight

CPQ technology can save a lot of time and money, but it also costs money to license and implement. There is no guaranteed ROI just by integrating Salesforce CPQ. If your budget doesn't allow you to comfortably pay the monthly/annual service fees, you may want to go in a different direction. While hiring a company like CaseNine to create a CPQ solution can save your company a lot of headaches and money in the long run, it's going to take time and effort up front to get started.

You like a hands-on approach

Salesforce CPQ automates so many parts of the quoting process as you implement it. If smaller organizations really want to keep all control in-house, verify, double-check, and then re-verify before sending the quote, then a CPQ solution may not be a right match. Efficiency and accuracy are the secret nicknames of CPQ software.

You are not yet using Salesforce Sales Cloud

While this may seem obvious but if you as a company are not already using Salesforce CRM, you need to purchase it first in order for CPQ to run as well as possible A good consideration is to look at Salesforce Industries. These products offer Salesforce CRM and CPQ in one solution for specific industries.

Multiple industries under one roof

Industries CPQ has tight vertical industries that makes setup a bit easier. However, if your organization serves a wide range of industries, such as healthcare and energy, Industries CPQ is not the right software solution.

You don't keep change

When Salesforce CPQ is integrated into a sales process, an organization must be prepared to change some internal processes. For example, if Bert in the sales department has been using the same system for 18 years, you might get backlash if you tell him it's time for an update. CPQ solutions are there to make quotation processes more efficient and accurate. Often that means a company needs to review and change its current methods and processes that have been implemented over time.

Not for everyone

Whether or not you should invest in Salesforce CPQ for your business is an important decision. It's going to cost you money upfront and ongoing to license the software. Setting up the software for your organization and turning it into a solution for sales teams also costs money. Then you have to train your people to use it properly and harness its true power. When implemented correctly, though, it can be really valuable and add value to organizations. For example, with clients we see conversions and sales go up, as well as repeat customers. It just takes a significant investment to get there.

Colin Hammer

Colin Hamer is a Software Engineer at CaseNine. He is responsible for various Salesforce projects at clients.