Consumers are making more online purchases than ever. In fact, United States retail e-commerce sales reached an estimated $277.6 billion in Q2 2023 alone, according to the latest report by the U.S. Census Bureau of the Department of Commerce. That represents a 7.5% increase over the same time period last year.
As consumers continue to shift their purchases online, they have come to expect the same level of technology-enabled customization in both their virtual and brick-and-mortar worlds. In other words, the experience has to be comparable whether they’re reviewing style options from home using a mobile phone or in a showroom looking at a sales rep’s tablet. Moreover, because corporate buyers are also consumers in their off-hours, these technology-enabled customizations have become critical to both business-to-business (B2B) and business-to-consumer (B2C) sales.
How CPQ and ERP Can Transform Manufacturing Customers’ Experiences
Configure, price, quote (CPQ) software empowers manufacturing companies, of all sizes and across all industries, to compete on the quality of their online customer experiences by making it easier to configure product options, view accurate pricing for those options, and quickly generate a quote.
CPQ software is particularly beneficial for companies that offer complex and customizable products, such as vehicles; heating, ventilation, and cooling (HVAC) systems; industrial equipment; and telecommunications systems, to name a few. It helps sales teams ensure accuracy in quoting, reduce quoting turnaround time, improve customer satisfaction, and ultimately increase revenue by closing deals more effectively.
CPQ complements a manufacturing enterprise resource planning (ERP) platform, which is used to manage sales, customer relationships, inventory, production, shipping, purchasing, accounting, and more. When CPQ and ERP systems are integrated, manufacturers can further optimize their processes to create superior experiences for their buyers. Let’s look at some of the ways these two technologies enable manufacturers to transform their customers’ experiences.
- Consistent customer experience via data synchronization: CPQ and ERP systems can be integrated to ensure that product, pricing, and customer data is consistent across both platforms. When a configuration is created and priced in the CPQ system, it can be seamlessly transferred to the ERP system to generate accurate invoices, manage inventory, and track the order’s progress. This helps to ensure that customers receive accurate information at any stage of the order.
- Accelerated order fulfillment via improved quote-to-cash process: Integrating CPQ with ERP automation streamlines the entire quote-to-cash process. Once a quote is accepted by the customer, the information can be automatically converted into an order in the ERP system. This enables manufacturers to accelerate their order fulfillment for customers by eliminating time-consuming manual data entry and the errors that come with it.
- Better alignment of customer expectations via inventory management: When a product is configured and quoted, the CPQ system can check the ERP system for real-time inventory availability. This prevents manufacturers from overcommitting on products that are out of stock. It also helps customers to make decisions based on real-time updates of whether all components are in-stock or will need to be ordered for the configuration they choose.
- Customer confidence via pricing consistency: Pricing rules and discounts established in the ERP system can be integrated into the CPQ software. This ensures that the configured quotes generated by the CPQ system reflect accurate and up-to-date pricing information from the ERP system. This information can be used to give customers confidence that they are receiving competitive pricing.
- Improved communications with automated order tracking: As an order progresses through various stages of fulfillment, the ERP system can provide real-time updates to the CPQ software. This allows sales teams to keep customers informed about the status of their orders without manual intervention.
- Availability of in-demand products via data analytics: Integration between CPQ and ERP systems enables comprehensive data analysis, providing insights into which configurations lead to higher sales, which products are most popular, and which pricing strategies are most effective. Armed with this data, manufacturers can prioritize the product versions and pricing strategies most in demand by customers.
- Improved support for highly customized and complex products: For businesses that offer highly customized or complex products, the integration of CPQ and ERP automation becomes even more valuable. The CPQ system helps sales teams configure intricate solutions, while the ERP platform manages all the details of the manufacturing and distribution processes.
CPQ and ERP systems provide an essential foundation for meeting the expectations of customers that have become increasingly comfortable with e-commerce—whether they are purchasing online or in person. By integrating CPQ and ERP solutions, manufacturers can enhance customer satisfaction by helping them make informed purchase decisions, ensuring their confidence in fair pricing, accelerating time to delivery, and providing accurate updates at any time during the production process. This in turn leads to higher sales and customer loyalty that enable long-time business growth.
Interested in learning more? Join us on Wednesday, September 13th at 11am EST to learn how to Improve your Sales & Manufacturing Processes with CPQ for ERP – click below to register!