Salesforce CPQ Tutorial

Are you ready to discover how Salesforce CPQ helps your sales team to create sales quotes faster than ever? I think you are at the right place to upgrade your Salesforce skill sets with this Salesforce CPQ tutorial. As we already know that salesforce has been growing tremendously in the current tech market and also it establishes the connection between the company, employees, and customers. Salesforce CPQ tool developed to overcome the hurdles of sales and marketing. As per the research almost 66% of people spend most of their time generating business quotes, writing reports, and proposals and there is a huge chance of getting inaccurate data as an output. So let's get started our journey with the Salesforce CPQ tutorial.

Introduction to Salesforce CPQ:

Salesforce CPQ stands for Configure, Quotes, and pricing of your business data. The Salesforce CPQ is just an extension of customer relationship management (CRM). This tool makes the sales process/ billing easier, faster, and more organized. The main purpose of Salesforce CPQ converts the sales cycle spreadsheet into an automated sales tool to deliver an error-free and accurate quote. Salesforce CPQ has come up with many advanced feathers and applications that help users to sell the correct product, discount control, and also automates the approvals. Salesforce CPQ is just a part of the Salesforce software system and founded in the year 2009. Salesforce CPQ pulls the inappropriate sales data into the configured mode to process and ensure consistency.

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Why Salesforce CPQ?

As I said earlier Salesforce CPQ has developed to overcome the sales hurdles with respect to billing, quoting, and approval. Very importantly, business enterprises should wait until they get final approval and aren't able to take up the next business deal. So Salesforce CPQ is helping most of the business enterprises to overcome this problem.

Let me discuss the key features of Salesforce CPQ:

Configuration features:

  • Offers bundles, features, and options.
  • Support inclusion, exclusion, and cardinality rules.
  • Work on real-time data with real-time rules.

Pricing features:

  • Supports multiple sales scenarios such as block-based, cost plus, and account-based, etc.
  • Perform real-time price simulations.
  • Users can able to perform custom formulae. Example margins and billing.

Quoting features:

  • Enables to quote business sales templates and document generation.
  • Ability to integrate with automated E-signature tools.

Other added features:

  • Promotes guided selling.
  • Automated renewal opportunities are available.
  • Supports for lightning experience and salesforce scenarios.
  • Support developers as well as communities.

Salesforce CPQ Architecture:

The following diagram explains how Salesforce CPQ works,

Salesforce CPQ model consists of relational junctions that enable businesses to integrate their business data in the Salesforce model. These junctions provide better communications and also effective data transformations between the multiple data sources. Adjacent enterprise systems like databases (SQL or RDBMS), ERP/CRM systems, and custom software applications. The basic functions such as from loading the business data to real-time data integration, these relational junctions simply modify the business process by creating customized data and continuously synchronizing the business data. This Salesforce CPQ model also supports hub-centric integration for better data flow. Also provides standard-based SQL interfaces to work with any complex level integration levels.

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Salesforce CPQ product configuration features:

Salesforce CPQ configuration describes how product bundles help sales representatives in the sales force. This also explains the difference between a bundle components, configurable bundles, and also explains how to add a configuration to the sales quotes. A bundle is simply a group of product that will be used by the time generating sale quote. When the sales representatives choose to sell the bundle, all the related products come along for the ride. In this tutorial I am going to explain the configuration methods, this bundle can be customized according to your requirements, with adding some bundle component limits to prevent it from impossible salesforce configurations.

It's like a create your own customized burrito. You can create your burrito with the help of the right amount of business data and integrate them for further configuration.

Salesforce CPQ pricing features and methods:

The following diagram explains the Salesforce CPQ pricing features and methods:

The list price is the quote line's initial price. When you quote a product, salesforce CPQ pulls the quote's lines list price from products list price entry in your book. If you select a product’s or quote lines price editable field, you can override the list price in the quote lines editor. The pricing method field in the product record is set to list by default, but you change the pricing method to cost or block pricing.

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Some of the pricing methods are as follows:

List price -> The product’s list price in the price book

Contracted price -> Inherits the value of the contracted price records.

Special price -> Inherits the value of the contracted price or special price assumes the value of the list price.

Prorated price -> this add the Price for Salesforce CPQ products applies the special price

Discount for products -> Salesforce CPQ apply the appropriate discount to the prorated price. The resulting value becomes the regular price.

Regular price -> the regular price inherits the value of the prorated price.

Additional discount -> Entered by the sales rep or through pricing guidance.

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Salesforce CPQ quote features:

Salesforce CPQ quote is really a presentation layer of opportunities and opportunity products. Here you can create a PDF to represent the quotes. And there is a page layout available in the form of a template that will cover under some segments to know how you can manage the information to present back to your client.

You can then create the PDF to save it as an attachment file against the quote. You can email this attachment document to your contact straight from the quote. It auto-generates a number every time you create a quote. When you create a Quote it's a record in the database. You have a Quote name. Free from the text, kind of like an opportunity name.

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Some of the important features of Quotes are;

  • Description Field: this is just like the other fields in other standard objects.
  • Contact name: When you create a quote, you have a contract role that has the primary checkbox.
  • You can also do custom fields: You can also add custom fields if you want to.
  • Lead time: You can also add time to give the client an idea of fulfillment time.

Salesforce CPQ productivity features:

Salesforce CPQ offers excited productivity features to produce a valuable result. Let me explain a few points:

  • Supports Guided and effective selling -> sales representatives are able to script questions and also guide the sales team/ customers from basic level to advance level.
  • Offers to create Customizable products-> this helps the sales team to create their own customized fields when customers search for the products.
  • Provide renewable benefits -> Salesforce CPQ has a feature of automatic generation of billing and also drives the pipeline projections and follow up with sales teams.
  • Products are available in the modern lighting of user experience scenarios.
  • These features are also beneficial for Salesforce communities enabling them to access the CPQ functionality.
  • This Salesforce CPQ is also available on the Salesforce1 Mobile device.

What is the Salesforce CPQ process flow?

Salesforce CPQ process flow covers the full end-to-end sales activities of the business organizations. This process flow mainly consists of sales details, account management data, customer order fulfillment, order billing, and account section functionalities.

This figure explains the functionality of Salesforce CPQ process flow,

Steps involved;

  • Firstly the sales team will configure the sales and order quotes and create a rough proposal draft for clients to know when the payment is received for the services.
  • This process is a completely customer-centric operation and all of them are independent. All these customer-centric operations will be tied together with the single business process.
  • The CPQ process flow helps the sales team to create a single platform to collect the customer data, process them and update them in the database to engage with the clients more effectively, this also reduces the error and improves the sales reporting capabilities.
  • The Salesforce configuration is listed as a first step in the process flow. Along with this process, some sales activities are also included such as cold calling, sales prospecting, inbound details, and invoice data.
  • When it comes to cash flow, the cash for the sales has been collected, allocated and end data will be analyzed and enhances the performances.
  • Sometimes a clash occurs between the sales representative and customers due to most of the time the customer assumes that the process of sales is over and they again start to place the new order.
  • During this time period, the revenue will be recorded, and also the cash will be applied. Again the entire process cycle will be reported and analyzed.

Salesforce CPQ – QTC flow:

Salesforce QTC is nothing but a Quote-to-cash process. This process covers the end-to-end cash details for sales activities in an organization.

Steps included are:

  • Firstly, you have the opportunity to deliver a quote to a prospect.
  • Secondly, you will configure the sales offers using software and the price of the offer is automatically and accurately generated. You can then present the quote for the project to your prospect.
  • Once the quote is approved, you draft the proposal and agreement.
  • The prospect agrees to place an order.
  • Then the order will be processed.
  • An invoice is created, and the new customer pays.
  • The cash for the sale is collected and allocated.
  • Keep additional values in the mind for the customer in the form of cross-selling and upselling.
  • The data for all points of the process is analyzed and reported.
  • Your process is improved for the next sale.
  • Integrated Salesforce QTC software can improve your sales and collection activities.

Salesforce CPQ system integration:

Salesforce CPQ is one of the flexible and easy to use software tools. This tool is widely used by the business organizations to improve their sales activities. Most of the companies still have doubts about how to build their data process flow method and pricing details between the ERP system and Salesforce.com.

Methods included in this integration process are;

  • Creation of Product master data: product master data is created and maintained in the ERP system because the ERP system helps users to insert additional data for the correct postings activities.
  • Product price/rate value: These product price values are typically maintained by the ERP systems they consist of information like discount structure on items/customers or sometimes both.
  • Product details: Product details are incorporated between the ERP system and the CRM system. Salesforce discount groups are automatically converted by the data integration and they are transferred into Salesforce (CRM) price books.
  • Product and pricing: this information helps to source the logic that you have already configured in the Salesforce CPQ. So the Salesforce CPQ system guides you all to select the right products and you can also optimize the commercial price setup as well as price rules.
  • Finally, the salesforce quote and the pricing will be converted and transferred into the ERP system and product configuration or selected in the Salesforce CPQ system.
  • Salesforce CPQ software tool can easily be with software platforms like Microsoft Dynamics (AX, CRM, Azure, MS office 365) and also with many non-programming platforms. These building concepts, process automation, and integration improve overall performance and scalability.

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Salesforce CPQ tools:

Salesforce CPQ is software that brings all the product pricing and customer data in the form of a centralized accessible platform that runs in a real-time environment.

There are 3 basic tools of Salesforce CPQ software:

1) Configurator

2) Pricing

3) Quoting

Features of configurator:

  • This enables the product bundle creation with advanced features and options. Features are the bundle categories and options are the bundle components.
  • Options can also make an integral part of bundles, accessories, or related products that supports the up-sell and cross-sell methods.
  • Support for cardinality functions, inclusion, and exclusion sales rules.

Features of pricing:

Pricing can be divided into 2 types:

1) Cost-plus based pricing -> this pricing type supports the product cost or price.

2) Contracted pricing option -> this supports account-based contracts.

  • The real-time pricing method supports the use of the case target price for configurator bundles.
  • Custom pricing formulae used for margin calculation and used in the process of pricing or discounts.

Features of quoting:

  • This quoting integrates the document generation.
  • Quote templates: in this case, different sections can be configured such as header, footer, and quote terms.
  • Also integrates the automatic E-signature tools.

How does the Salesforce CPQ tool work?

As I said earlier Salesforce CPQ system tools help to improve the sales performance, reduces errors, scalability, and produce accurate data.

Steps:

1. Buy the CPQ software tool.

2. The sales team will help you to select the product structure.

3. The orders and invoice management will be defined with product structure.

4. Once the implementation is completed, they go live.

5. The sales team helps the customers make use of the tool and enrich the selling process and win deals in a shorter time.

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Salesforce CPQ API model:

The attributes used in Salesforce CPQ API models are;

  • Record -> This represents the model.
  • AmountDiscountprorated -> it gives pricing and discount information.
  • ParentGroupKey ->   The unique key of this line’s parent, if this line is part of a bundle.
  • Key -> Each quote line and group has a key that is unique amongst all other keys in the same quote.
  • Upliftable -> True if this line is an MDQ segment that can be uplifted from a previous segment.
  • Configuration Type -> indicates the configuration type of the product that this line represents.
  • ConfigurationEvent -> Indicates the configuration event of the product that this line represents.
  • ReconfigurationDisabled -> if the condition is true, this line cannot be reconfigured.
  • ProductQuantityEditable -> the number of decimal places used for rounding this line’s quantity.
  • NetNonsegmenttotal -> the net total for all the non-dimensional quote lines.
  • QuantityEditable -> indicates whether the quantity is editable. Editability is determined by the quantity and bundled fields on the option record.
  • ProductQuanityScale -> Returns the value of the quantity scale field for the product being configured.
  • ReconfigureDimensionWarning -> Reconfigures the warning label for an option with segments.
  • HasDimension -> Indicates whether this option has dimensions or segments.
  • IsUpgarde -> indicates whether the product option is related to an upgrade product.

Guidelines for setting up Salesforce CPQ software:

The following are the important procedures to set up your Salesforce CPQ software in your organization:

Approval process:

Make sure that the org chart diagram flows; so that each individual person agrees on how a cash quote moves from one approval level to another and quote attributes move into each decision tree.

Company logo:

Design the company logo that you want to show in your quote document and add it to a folder in the salesforce document.

Discount schedule:

You can also create volume discounts based on the quantity of the product when you add these products to your salesforce quotes; CPQ applies a proportional discount to the grand total.

Multi-lingual considerations:

Determine the best plan for your non-English speaking users. You can also install Salesforce CPQ in a multilingual instance.

Package settings.

Basic page layout setup.

Product and price list.

Quote template and quote status.

Sandbox setup.

Advantages of Salesforce CPQ:

The following are the key benefits that CPQ brings to the sales team:

  • Streamlines the sales process.
  • Automated creation of sales quotes.
  • Helps manage complex product mix and pricing rules.
  • Helps to create a guided selling.
  • Boost the productivity of sales representatives.
  • Drives customer satisfaction.
  • Offers enhanced and rapid implementation without wasting time on any other relevant things.
  • Supports an individual to go for the creation of much accurate and better price quotes.
  • Business organizations can get a chance to perform a quick analysis of the percentage of profits or losses.
  • Improved accuracy and area of perfections.
  • Supports the most personalized experience.
  • Reduces sales turn-around time.

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Insight:

In this Salesforce CPQ tutorial blog, you might have learned the benefits and the features of Salesforce CPQ. Salesforce CPQ software tool most often used by the sales team in the organizations to reduce errors and produce accurate sales reports. Most of the CRM based companies have been started adopting Salesforce CPQ to overcome the sales hurdles. I hope this article may help a few of Salesforce developers as well as Salesforce community forums.

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John
John
Cloud Technologies & Cyber Security
John is a Post Graduate in Computer Science from Andhra University .She is currently working as an IT developer at hkr trainings.com. And he has great experience includes both IT development and operational roles. Connect with him on LinkedIn and Twitter. Thank you

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