A company’s success is measured by how often or how many products they have sold to their customers. While this is the last step in the entire sales process, the more this metric is optimized, the greater is the profit.
This end-to-end process starts when the customer first interacts with a company. It ends when the company sells them the product and receives funds. The company’s finances will benefit only when this end-to-end process is optimal, which is what the Quote to Cash or the Q2C cycle accomplishes.
Cash conversion notifies the company of the cash that is available after the money in assets and accounts departments is calculated. Cash conversion is a part of the Q2C cycle, but it does not encompass the entire process that Q2C contains.
This article outlines why a Q2C cycle is better than cash conversion, and what benefits it offers to companies looking to optimize their sales.
The Q2C process starts before the customer orders a product
Cash conversion, or order to cash, begins when the customer places an order. However, the Q2C process starts when the customer shows their intention to buy a product and continues until the customer purchases a product. The software will use the collected data to create a quote. From here, the Q2C process recognizes the opening to put forth a quote for the product to the potential customer.
Configuring a quote for the customer, pricing the offer, and generating a quote is considered the first step of the Q2C process.
The cash conversion process does not include this first step of generating a quote or sending it to the customer before the process starts.
Q2C leads to a higher acceptance rate
A prime reason why a Q2C process leads to a higher acceptance rate is that it is a single system that works throughout the process without needing any auxiliary system. This one tool helps sales representatives access all the data in a single place and helps focus their quality attention on their customers’ higher-order needs.
The cash conversion process does not deal with creating or negotiating potential contracts before processing requests. However, the Q2C cycle includes negotiating and executing contracts before processing.
This early start ensures that the customer is already aware of the quote and other contractual details, which leads them to sign the contract without further delay. The less time-consuming process leads to a greater acceptance rate for the contracts.
Automated Q2C process saves time and costs
Time optimization: Q2C software helps sales representatives optimize their time by automating the entire process. This time optimization requires the salespeople making fewer decisions and thus cuts down the time needed.
Useful guidance: With a Q2C tool, the sales representative can focus on only the current task as they have all the data that the automated software provided them with. This increases focus and eliminates mistakes that the salespeople might have made otherwise.
Reduced calculations: The Q2C software does all the calculations for the salesperson. A benefit of automated software is that the salespeople need not punch away at the calculator doing complex calculations.
Customize orders: The automated process also helps the sales representatives reduce the time from quote a price for the product and realizing it through fulfilling the order. This is because the automated tool can customize the order, quote, and the entire process according to each customer’s needs and preferences. It also eliminates the need to rely on excel to generate manual quotes and invoices.
Increased accuracy: An automated Q2C process also increases accuracy because there is no scope for manual errors in the entire process. The sales team can instead spend their time concentrating on the complex deals.
Related: Anatomy of Quote to Cash System
Q2C leads to an increase in sales cycle
A Q2C process helps to have a comprehensive and overall view of the entire sales process rather than focusing on individual components.
The Q2C process shows how the individual events in the process are related to each other. Thus, the Q2C process saves the time taken between quote creation for the customer and receiving cash for the product delivered.
This helps to increase sales because of the data that the salespeople see in real-time. Furthermore, the sales team would always have the recently updated data to make their decisions.
Q2C provides improved statistics that smoothen future sales
Another benefit of using the automated Q2C system is that it records data points across the entire cycle, stores and analyzes them. The system uses this analysis to improve the Q2C system and its data and make it better for the next sale.
Moreover, Q2C systems are easily scalable. As the company grows its customer base, it can scale the system to adjust to the needs and requirements.
The quote-to-cash process is better than cash conversion because it considers all individual components in the transaction and their relationships. The Q2C process begins even before a customer has placed an order. The minute a customer comes to a website to buy an item is when a Q2C process begins.
From there, it helps sales team craft a suitable quote and assists them throughout the process until the sale is done. The Q2C process does not end there. After the completion of the sale, the software analyzes the collected data and improves its algorithm for future sales. This way, the automated Q2C process helps sales teams to save time, optimize the tasks, and increase their efficiency.
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