The first set of questions that CEOs and sales managers should ask themselves were:
1. Does the complexity of product configurations affect your margins?
2. Is pricing and product information from your ERP always available to sales?
3. Do your sales teams make costing and pricing errors?
4. Are your approval regulations increasing the length of the sales cycle?
5. Are your margins eaten up by real production costs later?
Now let's discuss 5 more key pointers to discover if digitalizing your manufacturing sales will help you protect margins, lower the cost of sales, and secure deals faster than your competitors.
6. Is your Time to Quote (TTQ) worse than your competitors'?
Traditional methods of quoting with data retrieved from the back-end manually and contributed from many different parties like engineering, purchasing, and finally sales, can itself be a lengthy process. Customers will always negotiate prices or change requirements during the sales process leading to further quote iterations. If all that bundles up with quote errors that make corrections necessary, one can easily run into sales cycles extending to months. Manufacturers today need to employ a sales strategy to help them get ahead of the competition and move towards sales automation. A CPQ solution increases productivity, can cut sales cycles, and bring up to 40% reduction in Time-to-Quote (TTQ).
7. Can you introduce promotions or update pricing easily to your sales teams?
The ability to execute quickly in global and digital economies is a pillar to success that does not stop with manufacturing industries. The introduction of promotions and quick changes in pricing to match competitive offers or pricing uplifts for different countries must be automated in order to increase profitability and overtake the competition. A Digital Sales Platform with CPQ capabilities that supports modeling within the system is greatly improving your business agility. Make sure that admin functions in your CPQ include easy modeling either via the user interface itself, via Excel modelling and fast uploads or that changes in LO-VC models are reflected in your CPQ.
8. How long does it take to launch a new product or product variation?
The Time to Market or Speed to Innovation in engineering or high-tech industries can dictate failure or success in today's rapidly changing global markets. Besides struggling with commercialization, resources needed to conduct market opportunity assessments, scale-up production, or train employees, manufacturers' sales are notoriously slower to include new products into proposals. Sales teams often limit themselves to the most well-known products when catalogs consist of hundreds or thousands of products already. When choosing a digital sales solution to automate this crucial part of the sales process, an in-depth analysis of the capabilities to add or modify product and configuration models needs to be performed. The ROI of product innovation will be closely linked to the time to market.
9. Is your business missing out on revenue from up and cross-sales?
In manufacturing industries up- and cross-selling does not equal your average "do you want fries with that?" opportunity. Missing out on low-hanging fruit in these industries means missing out on deal size increases of up to 30%. In order to actively engage in these sales tactics, the specifics of product configurations and complexities in pricing need to be digitalized into respective models. A modern CPQ will then be able to suggest smart up- and cross-sales to your sales team to increase deal value and customer satisfaction at the same time. Be aware that a seamless connection and data exchange of your front- and backend is the basis for this revenue opportunity.
10. Are you losing money due to errors during order creation in your ERP?
In MTO and ETO businesses BOMs usually extend to hundreds of items and materials or finished products that are naturally not even existing in the ERP when the quote is created. What happens is that after a customer accepts a proposal those materials and products need to be created manually in the ERP, which is a large source of errors. With an advanced CPQ, integration to your backend should be that deep that products and materials can be created in ERP directly at the click of a button. This will be an important feature when it comes to not only sales productivity but order error considerations.
Did our article give you an idea of how a CPQ can help your manufacturing business improve profitability? Sign up for our free trial to browse industry-specific demo scenarios and see some of the above-mentioned features in person.