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  • CPQ in Salesforce

What is CPQ and What Does it Mean in Salesforce?


What does CPQ Stand for in Salesforce?

Salesforce CPQ is a native Salesforce app that helps you close complex deals. CPQ stands for Configure, Price, Quote, and its functionality is as follows:

  • Configure: You choose which products your customer will buy
  • Price: It calculates how much you charge
  • Quote: It produces a PDF to send to your customer

 CPQ is a faster, more controlled way to supply quotes with fewer errors and greater accuracy. It gets more deals moving through your sales pipeline and helps build stronger customer relationships.

What Does “Configure” Mean in Salesforce CPQ?

“Configure” means helping sales reps quickly and easily select the products customers will buy. Salesforce CPQ asks a series of questions about each customer and, depending on the answers, narrows down a potentially vast, complicated product catalog into the optimal customer-specific selection.

 If you have incompatible products, Salesforce CPQ is particularly useful in minimizing quoting errors and costly returns. It can be configured to restrict reps from selling technically non-viable bundles and direct them to more functional combinations, allowing them to concentrate on the next sale.

 For reps lacking the technical knowledge required to offer expert advice, especially new hires, Salesforce CPQ can be invaluable. It carefully guides reps through the sales process while providing follow-up questions, suggestions, and additional pieces of information along the way. This helps transform reps from ordinary salespeople into trusted advisors providing real value to customers.

It’s not just customers that benefit from Salesforce CPQ; you’ll see a direct impact on your company’s bottom line. The software works to intelligently increase order values and margins over time by suggesting upgrades, upsells, and add-ons at every stage of the customer relationship.

What Does “Price” Mean in Salesforce CPQ?

When it comes to “Price,” the starting point within Salesforce CPQ is the Salesforce Price Book, which contains all of the list prices for your company’s products. Any changes that sales operations make to prices in the Price Book filter downstream instantly to sales reps—putting an end to long email threads for every price adjustment.

Salesforce CPQ has several pricing tools that can be layered on top of price books to adjust prices for your specific pricing strategy and methodology. Whatever tools you use, your quotes will always be technically and commercially viable. The pricing tools within the CPQ include:

  • Block Pricing: Price quoted for a range of quantities rather than per unit, e.g., a cell phone contract might cost $10/mo for 200-300 mins of calls, or $15/mo for 300-500 mins.
  • Percent of Total Pricing: Price charged as a percentage of the sum of all the other products in the bundle, e.g., a 10% admin fee might be added to the quote.
  • Option Pricing Override: Product price is different when it’s sold as part of a specific bundle, e.g., a set of ink cartridges might cost $30 by themselves, or $10 when a customer buys a printer too.
  • Cost-Plus Markup Pricing: Price calculated by applying a standard margin to the cost price, e.g., if a printer costs $100 to manufacture and you use a 20% margin, then the retail price will be $125.
  • Contracted Pricing: The price of a product or category is applied to a specific customer account, e.g., “Top Customer” might pay $100 for a printer, while all other customers are charged $125.

By streamlining the entire process, Salesforce CPQ speeds up approvals by 95% on average. When a sales rep enters a discount on a quote, the CPQ informs them of the approval level required. For example, a 10% discount might need approval from a line manager, while a 20% discount needs approval from a VP. Once the rep confirms the quote, approval requests are sent out simultaneously, and approvers can confirm with the touch of a button.

 This standard approval process works fine in the majority of cases, but there are additional functionalities baked in, such as:

  • Smart Approvals: Once an approver has approved a quote, they won’t be asked to do so again if it’s rejected by a higher tier and subsequently resubmitted.
  • Delegated Approvers: An approver can assign someone else to cover them when out of the office or on annual leave.
  • Replacing Approvers: If one approver is replaced by another, the new approver is automatically subbed into every outstanding approval process.

What Does “Quote” Mean in Salesforce CPQ?

For customers, the “Quote” is a PDF document containing information about the products or services they want to buy, plus contact information, a table of prices with a total, and a few places for dates and signatures (or e-signatures).  

Sales reps can choose from several branded, highly configurable templates. Reps can add or hide columns, pages, sections, and terms for each customer with their configuration automatically saved for next time. Additional documents like product specifications can be added to the PDF, so everything is kept together in one place, and of course, all quotes are stored in the system for everyone to see.

Quotes within Salesforce CPQ have a secondary dimension: They serve as internal electronic records with expiration dates. Sales reps can create multiple quotes for each opportunity to play around with figures, be strategic, and share with others before choosing a Primary Quote to fire off to the customer.

How to Supercharge Salesforce CPQ

The Epicor CPQ enhanced product configurator takes the “C” in Salesforce CPQ to a whole new level. It handles the most complex product rules—ones that lie beyond the scope of Salesforce CPQ—and has been designed with manufacturers of highly customizable products in mind.

 Advanced CPQ product rules are created simply with Snap: a visual programming language that’s so straightforward that even non-technical people can use it and robust enough to handle the most complicated mathematical functions and complex manufacturing data.

Interactive visualization allows sales reps to configure products in 2D and 3D, changing colors, dimensions, and other product-specific attributes. This functionality can be embedded on your website, so end-buyers too can experiment with visual configurations, bringing products to life, changing prices dynamically, and boosting conversion rates as a result.

For configured products that require engineering drawings before sales can quote or manufacturing can build, Epicor CPQ has CAD automation with Solidworks, Autodesk Inventor, PTC Creo 3D models, and drawings. So, no more bottlenecks while reps wait weeks for manual processes to be carried out, with customers lost in the interim.


Configure, Price, Quote (CPQ)