When it comes to setting prices and offering quotes to customers, manufacturers tend to make three big mistakes:
- They are too slow to give the customer a quote because they have to talk to multiple people and review complex information to generate one
- They quote too high and the customer finds a better offer elsewhere
- They quote too low and eat into profits; completing the job may even lose you money
CPQ (Configure, Price, Quote) can be used to determine how to quote to customers, but businesses need to be careful. A lot of CPQ software and ERPs claim to make the process simple, but they don’t actually deliver on making it easier to quote. With the right software solution, it’s possible to quickly deliver a competitive quote that works within your profit margins.
What is CPQ and What Makes it Complicated?
As we said, CPQ stands for Configure, Price, Quote. As a manufacturer, your goal is to be able to calculate prices in real time so that you can offer quotes to customers within moments.
First, you configure the product so that it meets a specific customer need.
Next, you figure out the pricing. Pricing should factor in costs to produce the product, so you don’t lose money on sales from raw materials, labor, equipment, and utilities costs. Unfortunately, these costs fluctuate constantly, and sometimes considerably. During the pandemic, manufacturing and other sectors saw significant increases in raw material and inventory costs, in addition to facing pressure to pay workers better. As factors like these fluctuate, it can be hard to know how to price based on the numbers impacting you today. Pricing should also factor in customizations and any added expenses with the order.
Finally, you offer quotes to customers.
Real-Time Pricing for Quotes
Clearly, pricing in a way that factors in current data is a major challenge for manufacturers. Some ERP solutions claim to make CPQ simple when it comes to jobs, but some solutions like those from Epicor® can struggle with bringing everything together.
However, there are ERPs designed with real-time data in mind. With Infor’s CloudSuite Industrial (CSI) and their CPQ Configurator, you can see real-time data throughout your organization. We set up your system so that you can automate the quoting process to eliminate human error. You receive a quote within moments that automatically factors in fluctuating pricing costs like the cost of raw materials. You can even create customer-specific templates for quotes to make the process even easier.
For Infor CloudSuite consulting on CPQ, talk to the team at Datix. As ERP consultants who have implemented thousands of software solutions, we support our clients every step of the way throughout their ERP journey. From planning to the implementation and beyond, our team will do whatever it takes to bring your business to the next level.
ETO, MTO, CTO and Mixed Orders
No matter what options you offer customers, an Infor ERP solution can handle it. CSI was designed with manufacturers in mind so that it will support ETO (Engineer to Order), MTO (Make to Order), CTO (Configure to Order) and mixed mode orders. Its CPQ configurator allows you to see any proposed order using online visualization tools and establish set pricing rules to avoid costly quoting mistakes. Your documentation for the order will also be stored conveniently in one place.
For those looking for CPQ solutions, let us help. As an Infor partner that has implemented thousands of software solutions, we know how to maximize ERP setups. From integrations to hosting, infrastructure, and disaster recovery, our one-stop shop will support you with whatever you need.
To deliver the right quotes to your customers quickly, you need the right tool. An Infor ERP solution allows you to deliver quotes with ease that will outperform your competitors.
With over two decades in the industry, Datix is the ERP consultant of choice for manufacturers and distributors. We believe in “being the best with the best” and look for partners who match our commitment to solving real issues and doing what it takes. Our in-depth analysis of our clients and their business needs allows us to maximize their software investments to the fullest.