What Is CPQ Software in Telco?
Telecommunication companies (telcos) can have complex and customized products and services that can prolong their sales cycles. But in business, nobody wants to waste time. They need to deliver quick, accurate quotes to prospective enterprise clients. With highly configurable offerings, there may be inaccurate quotes, frustrated clients, stressed reps and, ultimately, lost revenue.
However, telcos can prevent this by integrating a tool that can help streamline their operations. This tool is known as Configure, Price, Quote (CPQ) software. But what does CPQ mean and how can this system help maximize your revenue? Discover how a single platform can simplify complex sales cycles—from pricing to quoting.
What Does CPQ Stand For?
CPQ is an acronym that stands for Configure, Price, Quote software, which forms three core components of the sales cycle. Here is a breakdown of each.
Configure
Configuring is the process of selecting and customizing products based on the consumer's needs. The customization is based on the product's features and capabilities. This step is all about matching the consumer's goals with the products' customization options. In telco, an example of this would be configuring a business communications package with specific service levels, user licenses and hardware.
Imagine having to manually enter these specifications and configuration details into a form or customer relationship management (CRM) system. It can be a time-consuming process. However, CPQ systems can help speed up the process—with accuracy—thanks to their integration abilities.
Price
Pricing is the process of calculating the total cost price based on the configured product specs. The pricing would include the base price and any markups or discounts added during the configuration stage. Markups and discounts will depend on the business's rules and options. Other factors that further influence the price include taxes, delivery charges and any special promotions at the time.
A CPQ system can automatically calculate prices based on a company's business model and other relevant pricing factors. There's no need for spreadsheets and manual calculations. CPQ software automates price determinations for complex pricing models, factoring in changing parameters like discounts and markups.
Quote
Quoting is the process of generating a professional document that outlines the configured product with its pricing determinations. The quote will also include the sale's terms and conditions, and the accepted payment methods. It serves as the exact record of the agreed-upon product and price negotiated between the buyer and seller.
CPQ systems can automatically build quotes that include all this important information. This automation allows negotiations, iterations and deal closing to happen much quicker than when done manually. All that sellers have to do is carefully review the document before sending it to the consumer.
