Businesses today must make sure they are increasing revenue and margins by optimizing their pricing, understanding the products their customers want, and speeding up the quote-to-cash motions to close deals quickly—all without losing customers along the way. The key driver of all these goals is the sales process. Sales leaders today must constantly assess their sales processes to make sure they can make improvements in these areas. Yet, many businesses find themselves coming up short when it comes to identifying, recommending, and implementing any changes they need to make.
There can be a myriad of selling and sales process issues, but in our experience, there are five that rise to the top across organizations in different industries. After exploring these, we will describe how an exciting class of sales technology – configure, price, quote or CPQ – can lead to immediate and long-term improvements.
What Are the Top Five Sales Challenges?
There are five key issues at the root of lagging sales performance.
- Quote inconsistencies. Inaccurate and inconsistent pricing can cause revenue leakage and low profitability. Problems with the pricing function include the inability to provide quick pricing, incorrect or incomplete pricing, or the inability to consider different market factors that affect pricing. For example, it’s hard for sales representatives to price accurately based on market factors including supply and demand, payment conditions, buyer history, warranties, promotions, market conditions, volumes, currency conversions, units of measure, and volume discounts.
- Configuration errors. Slow and error-prone configurations, quotes, agreements, and contracts can trigger a lot of churn and slow down the quote-to-cash processes. For example, configurations, especially for complex products or when there are hundreds of SKUs, can be difficult and slow even for a seasoned salesperson. Hanover Research showed that 84% of pricing professionals still use spreadsheets to manage their pricing strategies, introducing the possibility for error and slowing the process way down. Contracts and agreements can also be slow and error prone when done manually.
- Limited collaboration. Lack of collaboration between sales and pricing teams can cause miscommunications, errors, and lots of friction. Multiple sales stakeholders need to collaborate on quotes simultaneously to ensure alignment on the process and facilitate approvals.
- Poor understanding of buyers. Little or no comprehension of buyer behaviors and preferences can lead to poor user experience. When businesses don’t understand how and why a buyer buys, they can’t guide product selections, make upsell suggestions, and facilitate the proper configurations. Sellers must understand their customers well and cater to their preferences. For example, buyers don’t want to call sales representatives anymore to achieve these aims. Businesses must enable online processes to choose and buy products. According to our research, 63% of B2B buyers claim they purchase more from organizations that allow them to place orders in a self-serve fashion.
- Customer focus. Limitations on value-add sales activities will squander opportunities for sales to truly connect with customers. We’ve learned that only 37% of the average sales representative’s time is spent on revenue-generating activities. In the status quo, many sales reps spend a lot of their time manually building pricing, configuring products by hand, creating lengthy contracts and agreements, and getting approvals. Yet, in order to continue to grow accounts, sales must be elevated from order-takers and information carriers working at a transactional level to consultants, building relationships through providing industry insights and process advice, and engaging the customers to help solve problems with their products and solutions. Businesses have to eliminate the 63% of tasks that take away from these functions.
CPQ Transforms the Sales Process
CPQ software can help enterprises make business-critical improvements to the sales process, resolving these top 5 sales challenges. In fact, CPQ returns $6.22 for every dollar spent. Best-in-class CPQ tools, like PROS Smart Configure Price Quote enable:
- Consistent and accurate pricing. CPQ software like PROS Smart Configure Price Quote provides a performance quoting engine to help sales teams optimize growth and profit via a data-driven pricing processes that considers all the market factors that dynamically influence a current price. B2B organizations can ensure that buyers receive real-time, market-relevant prices independent of the sales channel.
- Faster sales processes. CPQ software can automate configurations and quotes and build contracts quickly. The PROS Platform equips sales teams with tools to quickly find, configure, and quote the right products for customers with speed and precision—including the ability to create large quotes and RFPs with up to 10K line items with no performance degradation. PROS Smart Configure Price Quote also supports the creation and management of sales agreements and contracts with workflows such as create, amend, extend, and end.
- Seamless and fluid collaboration between sales and pricing teams. CPQ software allows multiple people to collaborate on a quote or sales agreement simultaneously. For example, companies frequently need to make modifications to the price of the products in an agreement due to cost changes, guidance changes, or strategic pricing initiatives. These modifications can be time-consuming due to the manual collaboration that needs to occur between the pricing analyst, the salesperson, and the customer. The agreement price change capability in PROS Smart Configure Price Quote streamlines the process of making mass price changes which affect all existing sales agreements, enabling companies to quickly react to market changes and new strategic directives.
- Improved and precise understanding of buyer behavior. CPQ software helps enterprises understand buyers vias AI-based processes that use vast historical data to enable predictive suggestions, appropriate configurations, and more personalized offers. No need to call a sales representative to help select products. Understanding buyer behavior also leads to better user experience, which is a key factor when buyers make purchasing decisions.
- Increased value of the salesperson. By automating the approval process and the generation of proposal documents, salespeople can reclaim much of the time they spend on administrative duties or engaging in manual processes. Instead, they can better use their time to provide consultation to and problem solving for their clients.
When we meet with clients to understand the top issues in the constantly evolving sales landscape, we find that manual processes, poor pricing controls and lack of ability to offer the right products impact growth and profit. Over and over again we hear that customers need help in providing buyers with products aligning with their needs, driving easy and accurate interactions, using the best data available, and enabling salespeople to be more consultative. Future-looking companies are investing in sales tools that increase sales productivity and accelerate sales velocity. The benefits are astounding with PROS Smart Configure Price Quote businesses can see a 20% increase in win rate, 5% increase in revenue, 2% increase in margin, and 20% increase in lifetime value. The CPQ solution is part of the PROS Platform for Sales, a fully integrated, intuitive platform that eliminates barriers between your pricing, sales, and eCommerce teams, and optimizes every shopping and selling experience.
To learn more about CPQ and the PROS Platform, here are some resources:
About the AuthorMore Content by Jerome Cahuzac