According to TSIA, quoting in technology services still looks a lot like it did 20 years ago. It’s slow and expensive, it’s error prone, it lacks visibility, and it often misses revenue opportunities. But, a quiet transformation is taking place as Services teams embrace a new technology: Configure Price Quote (CPQ) for Services. These teams are gaining new streams of frictionless revenue, innovating their pricing models, building attractive solution bundles, and radically simplifying their sales process. And, without spreadsheets, they are achieving a level of revenue and resource demand visibility once considered impossible.
While there are specific tools on the market you can choose to assist with CPQ for Services, choosing a PSA solution with CPQ for Services functionality built into the platform, is considered best practice for organizations hoping to drastically improve the quoting process for their services business.
What makes CPQ different for services organizations?
CPQ often becomes more complex when quoting for a services-based business. It can be as simple as a block of hours or a line item with a price, but it can also be more complex, requiring effort estimation based on many variables. It can include project phases and stages that change from opportunity to opportunity. It can require adjusting the hours on the project timeline to reflect the unique requirements of an opportunity.
Pricing can be time-and-materials, fixed-price, cost plus, outcome-based, or a combination. Unlike with products, discounting isn’t just a percentage in need of an approval. With services, reducing the price often means changes in scope, timeline, or resources, which impacts risk, not just margin.
Contrary to popular belief, Services teams don’t quote resources, but rather, they quote skills. Required skills vary considerably from quote to quote and from resource to resource, even when the resources share the same title. The list of things that make quoting services different and sometimes complicated, could go on and on.
How CPQ For Services improves the way services organizations handle quoting:
Until recently, CPQ software was designed for product and manufacturing companies, not services-focused operations. But, that has changed with PSA solutions like Krow Software with CPQ for Services functionality built right into the platform.
Designed specifically for services organizations, Krow PSA delivers a complete Configure, Price, Quote solution including the ability to create services proposals, sync proposals with projects and sales opportunities, create branded quotes and statement of work.
Constellation Research estimates that companies adopting CPQ see a 300% increase in quoting speed. In other words, it’s a lot cheaper. These companies also introduce new pricing and solution bundling, making them more competitive. This is why a PSA solution with CPQ functionality built-in is the best choice for services organizations looking to improve efficiency and capitalize on revenue opportunities.
See how CPQ functionality can create efficiency for your services organization. Sign up for a 30 day free trial of Krow PSA: