Drafting accurate proposals isn’t easy. And if you’re selling with highly variable features, pricing structures, or discounts, keeping track of the information you need can get complicated fast.
Over the past 10 years, firms have managed this complexity with a crucial solution—Configure, Price, Quote (CPQ) software. CPQ is a category of software that helps organizations sell complex products and projects by quickly generating quotes and proposals, with opportunities to create custom product configurations and pricing rules.
CPQ solutions are prevalent in product-based sales, helping to manage the many complexities that go into creating proposals. But what about firms that sell services? Can they still benefit from traditional CPQ solutions—or is there a better way to handle these engagements?
That’s where Services CPQ comes in. Let’s take a closer look.
What Is Services CPQ?
Addressing the Limitations of Product CPQ
Traditional CPQs have been around for decades now, but their use has typically been limited to products with little variability or complexity. Professional services firms using CPQ solutions are likely to encounter gaps, which are often filled by spreadsheets, docs, and homegrown systems.
Services are typically much more variable and configurable than even the most complex products. Unlike product sales, services require teams of experts, are less predictable in their outcomes, and often involve multiple phases or overlapping timelines. Product CPQ lacks the functionality needed to capture the pricing structure and custom dependencies of services engagements.
In recent years, a new category of CPQ—aptly named “Services CPQ”—has emerged to address this problem. Solutions like BigTime Services CPQ utilize tools and functionality specifically built for services to streamline pre-sales and generate documents.
How Services CPQ Fits In
As the name implies, Services CPQ focuses more deeply on configuration, quoting, and pricing in professional services. These processes are often more cumbersome, complex, and less repeatable in professional services than at product-based organizations.
Services CPQ software enables services sales teams (Sales, PS, CS, Revenue) to quickly, easily, and accurately generate custom services quotes and proposals for prospects and clients. This software simplifies the sales process by standardizing services offerings, providing governance, and using logic and automation to pass accurate data into your CRM.
Furthermore, many Services CPQ platforms can handle service catalogs, and serve as a dynamic and integrated repository of all services SKUs, pricebooks, and other relevant content, allowing the business to scale and change its offerings quickly and easily.
Services CPQ shines when it comes to quoting different combinations of features and pricing structures. It is able to automate much of the work needed to create complex quotes, get them approved, and turn around accurate proposals.
Signs You Need Services CPQ
So, Services CPQ is better for services firms, while traditional Product CPQ is better for products. But does your services firm need a CPQ solution at all?
If you’re beyond the startup phase and sell anything that has any degree of configurability and flexibility in price, a CPQ is almost a must-have. Here are some of the signs that your firm might—or might now—benefit from this solution.
1. It takes days or weeks to finalize a Statement of Work
Lagging SOW velocity is arguably the top indicator your business needs a Services CPQ, because it’s almost always a sign of other pernicious issues:
- Disjointed relationships between Sales, Customer Success, Professional Services, Ops, and Finance
- Rudimentary tools that aren’t integrated
- Slow approval workflows
- A combination of all three
Outside of the most complex and custom use cases, generating an accurate SOW should never take weeks.
Services CPQ cuts these lengthy processes by removing the need for internal back and forth. It allows your team to generate SOWs and get them approved in a matter of clicks from a single platform.
2. Services content lives in spreadsheets, docs, and elsewhere
If your sales or CS reps even need to glance at a spreadsheet when configuring or pricing services, there’s a problem.
Don’t get us wrong—we’ve seen some impressive spreadsheets, and we have nothing but respect for the whiz Sales Ops folks who’ve managed to strap together a pricing calculator from 10,000 Zapiers. But sheets, docs, and homegrown systems will always fall short of a dedicated Services CPQ platform.
Why? These DIY systems simply do not scale. They almost always require dedicated time and resources to maintain properly. On top of that, they typically do not integrate well with other upstream and downstream systems like your CRM, PSA, and more.
Services CPQ, by comparison, provides a scalable, singular source of truth. With one central solution, you can be assured that SOWs are constructed with fully accurate pricing and language.
3. Sales reps keep moving into unapproved territory
Let’s face it—salespeople are critical to your firm’s success, but in the middle of closing deals, they don’t always have time to read the fine print.
A CPQ solution ensures sales reps can keep selling, without accidentally promising something your firm can’t deliver. Services CPQ’s rules, integrations, and user interface come together to create guardrails that guide sales reps and prevent them from making inaccurate promises about custom product configurations and pricing.
4. Your approval process is lengthy and messy
Tell me if you’ve heard this story before:
- Sales sends a proposal to the engagement manager.
- The engagement manager reviews with Rev Ops. Rev Ops says, “Hold up…we can’t approve these payment terms.”
- So Sales communicates with the prospect on new terms. The new terms are agreed upon, and a new proposal is sent to the engagement manager.
- All of the sudden, Legal steps in—there’s a key clause missing in the proposal!
- Once again, Sales revises the proposal and reviews with the prospect.
- Two weeks later, the proposal is finally approved.
With Services CPQ, situations like this can typically be avoided. Any product configurations with tricky terms and pricing can be built in and pre-approved before a proposal is drafted. By aligning the team from the start, you save multiple departments a lot of time and headache.
Signs You Don’t Need Services CPQ
A CPQ solution is a powerful tool, but it isn’t for every business.
You probably don’t need Services CPQ if:
- Your business primarily sells physical goods
- You focus on B2C sales
- You work with simplified products and pricing structures, without significant nuance or variation
The Impact of Services CPQ
Research has shown there’s some incredible gains to be had from CPQ:
- 105% larger average deal size ($432K vs. $211K)
- 49% higher proposal volume (20.9 vs. 14.0 per rep, per month)
- 28% shorter sales cycle (3.4 months vs. 4.7 months)
- 26% more reps achieving quote (58% vs. 46%)
- 17% higher lead conversion rate (35% vs. 30%)
At the end of the day, a CPQ is an investment that affects multiple teams and stakeholders within your business. A unified discussion across these teams and good planning is required to understand how CPQ can benefit your business’s ROI.
Growing sustainably with BigTime Services CPQ
The demand for professional services is growing rapidly, and with growth comes an increased need for more efficient, automated processes. Professional services teams are quickly learning that they need to upgrade their technology to give customers the experience they desire. That’s key to winning, retaining, and upselling services—but technological innovation in these firms often lags behind.
Professional services are complex and hard to sell. That’s not helped by archaic sales systems consisting of spreadsheets, email exchanges, and an avalanche of Word docs. In order for services to advance, the entire selling process needs to be integrated into the technology selling teams already use.
BigTime Services CPQ was created to make selling professional services fast, easy, and accurate. With a CPQ solution designed for professional services, you can digitize service catalogs, automate discovery, and enable teams to deliver quick and error-free quotes.
Interested in seeing how BigTime Services CPQ can shorten your sales cycle and increase your win rate? Book your free demo with our team today.
