Salesforce CPQ: What it is, How it Works, and Alternatives to Consider

Salesforce CPQ: What it is, How it Works, and Alternatives to Consider

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Imagine a scenario where a sales rep needs to send a customised quote for a highly complex product, complete with various configurations and pricing options. In the past, they’d have juggled a few spreadsheets and run a handful of manual calculations, but new tech advancements mean they can leave these cumbersome, error-prone tactics behind.

Enter CPQ software, a solution designed to speed up the quoting process with automated configurations.

Here, we explore the core features and benefits of using a configure, price, quote (CPQ) solution that integrates with the Salesforce ecosystem. We’ll cover who it’s for, how it can benefit your business, and offer a dynamic alternative.

What is a CPQ For Salesforce and Who is it For?

A CPQ in Salesforce is a tool designed to streamline the configure, price, and quote process so that reps can quickly generate accurate quotes, configure product offerings, and automate pricing calculations all within the Salesforce ecosystem.

Because product and pricing options are integrated with Salesforce’s native CRM, sales teams can match quotes to individual customer needs based on their previous purchase history, preferences, and lead status and sync all interactions within the platform.

Any changes to vital product information trigger an immediate update in the CPQ tool. This means sales reps can quickly generate an order and consistently provide precise quotes that mirror the latest prices and promotions.

It’s worth pointing out that while Salesforce CPQ is an add-on offered by Salesforce themselves, there are plenty of other CPQ solutions that integrate with Salesforce and might be a better choice for your business depending on your industry, product catalogue, and bandwidth of your Salesforce development team.

While Salesforce CPQ has plenty of features for companies selling “widgets”, software, or products with fewer configuration options, it struggles to cope with complex product configurations. For example, industrial equipment manufacturing companies or those selling solutions with services and physical products might find customisation opportunities in Salesforce CPQ pretty limited.

Explaining CPQ (Configure, Price, Quote) Software

CPQ software allows salespeople to automatically create accurate quotes and orders for customisable products and services.

Imagine you’re selling a product in different sizes, colours, and add-ons. CPQ software lets you input these options which you can then pull automatically from a database to generate a tailored quote. For example, let’s say a potential customer asks for a quote on a customised laptop. Instead of thumbing through spreadsheets to figure out pricing for all the different configurations, you can simply click and select them in your CPQ software.

It automatically puts together the perfect quote, considering everything from the processor type to the amount of RAM and even warranty options. Think of it as a handy assistant who knows your product configurations, pricing, and discounts inside out.

The great thing about CPQ software is it can be used across industries, from industrial manufacturing to service-led companies, and physical product businesses. It integrates seamlessly with your CRM, so you can efficiently track and manage every quote.

5 Reasons a Salesforce CPQ Software is Essential For Your Sales Team

Regardless of the solution you choose, your sales team will thank you for using CPQ software within your Salesforce environment.

1. Quick, Accurate Quotes, Every Single Time

Using CPQ software with Salesforce automates the configuration, pricing, and quoting process, which allows sales reps to create complex quotes quickly and accurately. This dramatically reduces the time spent on manual tasks.

For example, a sales rep at a manufacturing company might be tasked with creating a quote for a custom-engineered product with various configuration options. With an integrated CPQ, the rep can easily select the appropriate product features, pricing rules, and discounts from a centralised platform based on the customer’s preferences and unique needs. The software then automatically calculates the total price based on the selected configurations, ensuring total accuracy and consistency across quotes.

2. Total Visibility into the Sales Process, From Lead to Sealed Deal

Salesforce CPQ integrations seamlessly connect with CRM systems so teams can manage quotes, contracts, and orders in one centralised platform. Say a company offers multiple product tiers and subscription options. If the sales team uses CPQ in Salesforce, they can create quotes, track contract renewals, and manage customer subscriptions within the same system. This enhances collaboration between sales, finance, marketing, and operations teams, leading to more closed deals and improved customer satisfaction. This is important, considering only 30% of sales reps believe their sales and marketing departments are aligned.

3. Adapt Quickly to Changing Market Conditions

A Salesforce CPQ is highly configurable and was built to scale with you. The flexible pricing models, product bundling options, and customisable workflows to accommodate complex sales scenarios help you adapt to changing market conditions and evolving customer needs.

Let’s say a company expands its product offerings to include new services like cloud-based storage or cybersecurity solutions. The sales team can easily configure and price these new offerings, create customised bundles for different audience segments, and roll out company-wide pricing updates with little disruption.

4. Break Away From Departmental Silos

Integrating CPQ software with Salesforce facilitates collaboration and communication between departments—whether that’s the sales team, product managers, or other stakeholders involved in the quote-to-cash process. It provides total visibility into deal status, pricing approvals, and discounting policies so teams can work together more effectively to close deals.

In large enterprise software companies, reps often collaborate with product managers to create customised solutions for enterprise clients. With Salesforce CPQ, they can collaborate in real-time, leveraging product catalogues and pricing rules to tailor proposals to specific customer requirements.

5. Understand Deal Data

A Salesforce CPQ offers robust reporting and analytics capabilities that provide valuable insights into sales performance, pricing trends, and deal profitability. Sales leaders can track key metrics, such as win rates, average deal size, and sales velocity to identify areas for improvement and make data-driven decisions.

For example, comparing win rates and average deal sizes for each product can reveal which drives the most revenue and which may require pricing or packaging adjustments. Armed with this data, sales teams can prioritise their efforts and focus on selling the most profitable offerings.

How CPQ Streamlines Sales Processes and Ensures Accurate Quotes

CPQ simplifies complex product configurations and options, creating a dropdown customised menu that reps can use to build out targeted quotes.

If your business sells a suite of varying product options, each with its own features, pricing tiers, and compatibility requirements, it can get very confusing, very quickly. Without centralised data on each configuration, reps might find themselves pouring over endless spreadsheets and making manual calculations—which, let’s face it, are prone to error.

Boost Sales Rep Productivity with CPQ Software

Think about the countless hours your sales team spends crunching numbers and chasing approvals for pricing discounts. CPQ software applies real-time pricing rules and logic, ensuring consistent and accurate pricing across all quotes. For example, you can apply volume discounts or promotional offers across the board without requiring reps to manually enter them for each new quote.

There are also built-in approval workflows that allow managers to quickly review and approve discount requests, which ultimately keeps the sales process moving forward. The average sales team uses 10 tools to close deals and 66% of reps say they’re drowning in tools. Integrating CPQ software with a CRM reduces the number of tools reps need to log in to each week.

Empowering Sales Reps to Focus on Selling Rather Than Manual Tasks

With a centralised quoting system, reps can create professional-looking quotes in just a few clicks. They no longer need to juggle multiple tools and documents. Instead, they can access customer information, product catalogues, and pricing data all in one place. This boosts productivity levels and empowers reps to focus on selling instead of repetitive, manual tasks that don’t move the needle.

Create Enjoyable Customer Experiences From the Get-Go

CPQ isn’t just about making life easier for your sales team. Customers no longer have to wait while reps fumble through spreadsheets and request pricing approvals. Instead, they can enjoy speedy, accurate quotes that instill confidence.

Plus, the ability to create professional-looking, tailored proposals means customers feel valued and understood. They no longer have to decipher complex pricing structures or wait days for a quote. Instead, they receive a seamless and personalised experience that sets the stage for a positive relationship.

How Salesforce CPQ Integrates with CRM for Seamless Sales Processes

Salesforce’s in-built CPQ software only integrates with Salesforce CRM. This limits users who might want to switch from Salesforce CRM later down the line because they’ll also have to find a new CPQ solution. Instead, you can use CPQ software that integrates with most CRM systems—including Salesforce’s CRM.

This means sales teams have all customer interactions, deal information, and quoting processes at their fingertips, and can pull relevant data in just a few clicks. They can access customer information, product catalogues, and pricing information without switching between multiple applications. This enables real-time updates and fosters collaboration across teams to make sure everyone is working with the most up-to-date product and pricing information.

Salesforce CPQ Features You’ll Want to Use

Here’s a breakdown of CPQ features you should look for to supercharge your Salesforce environment..

  • Product configuration. Easily configure manage and adjust complex product configurations with customisable options and rules.
  • Pricing management. Apply dynamic pricing rules, discounts, and promotions to individual products or categories to ensure accurate and competitive pricing.
  • Quote generation. Create professional-looking quotes and proposals quickly with customisable templates and branding options.
  • Approval workflows. Get pricing discounts and quote revisions signed off quickly with automated workflows.
  • Contract management. Monitor and manage contract lifecycles, renewals, and amendments from one centralised place.
  • Guided selling. Arm sales reps with selling tools that help them recommend the best products and pricing options based on customer needs.
  • Renewal management. Automate the renewal process and track contract expiration dates so you can deliver timely renewal reminders and upsell opportunities.
  • Reporting and analytics. Get insights into sale performance, pricing trends, and deal profitability to help reps prioritise which products to push.
  • CRM integration. Seamlessly joins forces with CRM systems to centralise customer data and bring the sales process into one platform.

Choosing the Best CPQ Salesforce Solution for Your Business

The CPQ solution you choose will depend on your industry, product catalogue, and the complexity of your product configurations. For example, Salesforce CPQ is great for software companies that sell recurring subscriptions, whereas it might struggle to provide the customisations needed to configure highly complex product catalogues.

One of the main downfalls of Salesforce CPQ is that you often need a Salesforce developer or IT team to build out any new products and rules or to cutomise the solution. It’s not particularly user-friendly. This can end up becoming costly if you don’t have the resources in place or it could dramatically slow down your processes if you have to manually add in new product configurations.

Start by assessing your sales processes and identifying major pain points or bottlenecks. For example, does your sales team spend ages trying to match different product configurations or do they waste a lot of time in manual spreadsheets?

Then, consider the following:

  • How complex are your product offerings?
  • How many quotes do you generate each week/month/quarter?
  • How much customisation do you need?

Once you’ve answered these questions, evaluate different CPQ solutions based on their ease of use, scalability, and integration capabilities. In particular, look for a solution tailored to your industry, whether that’s manufacturing, healthcare, technology, or services.

Experlogix CPQ eradicates the need for a dedicated Salesforce developer or IT team. It’s a low-code solution that makes it easy for business users to make changes and use the solution without waiting on an external stakeholder to create or edit configurations.

3 Signs Your Business Has Outgrown Salesforce CPQ

Sometimes, it’s time to move on from your current CPQ. Here’s what to look out for.

1. You Have a High Volume of Quotes and Transactions

As your business grows, so does the volume of quotes and transactions processed through Salesforce CPQ. If you’re experiencing bottlenecks, slow performance, or system limitations when dealing with high volumes of quotes, it could indicate that your solution is struggling to keep up with the demand. This can lead to delays in generating quotes, pricing errors, and, ultimately, lost sales opportunities.

2. Your Product Configurations Are Too Complex

If your business has evolved to offer increasingly complex product configurations, pricing structures, or contract terms and Salesforce CPQ isn’t staying up to speed, it’s a sign you could be outgrowing your current solution. For example, you might find yourself constantly adding customisations or workarounds to accommodate new requirements, which can lead to a clunky, Frankenstein-esque quoting process.

3. You Can’t Integrate it With Your Existing Tech Stack

If you can’t integrate Salesforce CPQ with other business-critical platforms such as enterprise resource planning (ERP), ecommerce platforms, or third-party apps, it might be time to look elsewhere. The inability to connect up your tech stack can quickly lead to data silos, manual data entry errors, and sluggish workflows that impact productivity and customer satisfaction.

Get All the Flexibility With None of the Complexity With Experlogix

Salesforce CPQ is great if you sell widgets, software subscriptions, or products that don’t have a ton of configuration options. But anything more advanced can leave it struggling to keep up with demand and, as a result, impact the speed and accuracy of your quotes.

Experlogix was designed for companies with highly complex product configurations without being a complex solution to use. Unlike Salesforce CPQ, Experlogix seamlessly integrates with ERP solutions to access up-to-date pricing and inventory in seconds. Plus, you don’t need a team of developers on hand to maintain the platform and your workflows. Instead, Experlogix lets you make changes quickly and accurately.

Salesforce CPQ also lacks document automation for quotes, contracts, and agreements. Final proposals are a lot less visually appealing and look more like a traditional table with line items. While this is functional, it’s not particularly on-brand and doesn’t deliver an exceptional customer experience. With Experlogix CPQ, you can incorporate dynamic imagery, logos, and custom text in your quotes to keep them customer-specific and on-brand.

Salesforce CPQ is Good, But Is It Right For You?

There’s no doubt that Salesforce CPQ is a robust tool that can absolutely enhance the configure, price, and quote process within the Salesforce ecosystem. It enables sales teams to generate accurate quotes efficiently, leveraging CRM integration for personalised customer interactions.

While it excels in certain contexts, particularly for companies selling simple product catalogues or software subscriptions, it may face limitations with complex product configurations. Experlogix offers an alternative solution for businesses dealing with intricate product setups, boasting seamless integration with ERP systems and user-friendly customisation options.

Ultimately, the choice between Salesforce CPQ and Experlogix CPQ depends on the specific needs and complexity of your industry, business, and product catalogue.

Ready to accelerate your B2B sales? Get in touch to explore how we can make digital work for your business. 

About the author

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Lizzie Davey is a Brighton-based has copywriter who has worked in the SaaS, and ecommerce world for 10 years.

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