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CPQ and Quote-to-Cash (QTC) are two terms for solutions that are often used interchangeably, but they refer to different stages of the sales process. While both are important components of the sales cycle, they have different objectives and points-of-focus. In this blog post, we will explore the key differences between CPQ and Quote-to-Cash.
What is CPQ?
CPQ stands for Configure, Price, Quote, and it refers to the software that allows companies to automate and streamline the quoting process. CPQ software is designed to help sales teams create accurate quotes quickly and efficiently, by configuring products and pricing based on key rules and parameters. CPQ software typically includes features such as product configuration, pricing management, and quoting automation.
The CPQ process typically involves the following steps:
Configure: Sales teams can use CPQ software to configure products and services based on key rules and parameters. This ensures that quotes are accurate and consistent across the sales team.
Price: Once the products and services have been configured, CPQ software can help automate the pricing process based on key rules and parameters. This can include pricing based on discounts, volume, and other factors.
Quote: CPQ software generates quotes automatically based on the configured products and services and the pricing rules.
CPQ software is designed to help sales teams streamline the quoting process, reduce errors, and improve accuracy. By automating the quoting process, sales teams can respond to customer requests more quickly and effectively, improving the overall customer experience and cutting sales and revenue-generation cycles.
Quote-to-Cash (QTC) refers to the entire sales cycle from the initial quote to the final payment for the revenue-generating product or services. This entire cycle includes all the steps involved in the sales process, from lead generation to sales, order management, invoicing, and payment. QTC software is designed to help companies manage the entire sales process, from lead to cash.
The QTC process typically involves the following steps:
Quote: The sales team uses CPQ software to generate quotes based on the customer’s requirements.
Sales: Once the customer has accepted the quote, the sales team works to close the deal and finalize the sale.
Order Management: Once the sale has been completed, the order is entered into the system and managed through the order management process. This includes processing the order, tracking inventory, and managing fulfillment.
Invoicing: Once the order has been fulfilled, an invoice is generated and sent to the customer.
Payment: Once the customer has received the invoice, they make a payment, either through an online portal or through traditional payment methods.
QTC software is designed to help companies manage the entire sales process, from an initial lead to pricing and quoting to closing to cash. By automating the process, companies can reduce errors and improve efficiency, resulting in faster revenue growth and better customer experiences.
Key Differences Between CPQ and QTC
While CPQ and QTC are related and overlap, there are some key differences between the two processes. CPQ is focused on automating the quoting process, while QTC is focused on managing the entire sales cycle. CPQ software is primarily designed to help sales teams generate accurate quotes quickly and efficiently, while QTC software is designed to help companies manage the entire sales process, from lead generation to cash. By understanding the differences between the two processes, companies can take the next step in selecting the right tools and processes to optimize their sales processes and improve revenue growth.
For more information on how Mobileforce’s intelligent quote-to-cash solution may be able to help your company, book a meeting with us.
