August 27 by Patrick Wolf
What is a Price Quote?
Before we get into the must-haves of every price quote, let’s first define the subject of this post. A Price Quote is a price estimate of a given product, solution or solution bundle based on the needs discussed with the prospective client. Depending on the complexity of the asked for product, the initial price quote can merely be the start of negotiations, or the set-in-stone non-negotiable price. There are many systems available today, such as a CPQ (Configure Price Quote) System, that automate and make intelligent the process of creating and sending a price quote so as best to win a deal.
Why is it important to provide the Perfect Price Quote?
This is easy, and scary – it is the first chance that you have to make a good impression on a potential customer. The ability to deliver an accurate, well thought out quote within the prospects required timeframe is the first indication that you or your business is worth there time or day. Not only must the quote be presented in a professional and 100% accurate manner, it must also be easy for the customer to read, understand, and potentially sign. If you don’t make it easy, or if the quote is riddled with errors, it could completely end the deal – leaving all the discovery and proving time spent on the table to go to waste.
Alternatively, imagine a situation in which a poorly thought out and executed quote makes it through the cracks – the prospect simply can’t do without you services, no matter the unprofessionalism (what dreams are made of). The mistakes in the price quote can trigger downstream problems in operations, billing, procurement, ect. – causing long term problems with the now customer. In addition, new regulations, such as ASC 606, will force companies to rethink entirely the terminology that they use in there contracts.
The 7 Essential Price Quote Elements
1. Key Deal Dates – Be sure to include any of the necessary deal dates within the quote, dates that the end deal will be contingent on. Without adequately defining such dates, such as service start date or offer valid through date, it will be difficult to keep each side accountable.
2. Shipping Contact, Payment Contact, Sales Person Contact – This pretty much speaks for itself, however you would be surprised how often this can be left out of a quote. Establishing a clear line of contact will ensure that there are no errors down the line.
3. Product Info – Ensure that you include sections such as a clear name, the agreed upon quantity of the product, the price with any agreed upon discounts, and finally any services that will be needed to bring the product to working condition.
4. Auto Calculated Total – Don’t just list out the final price – spell EVERYTHING out. Make sure that you include the subtotal, the effective discount, and the total price.
5. Special Terms
6. E-Signature – Incorporating E-signature into your quote is a must have in 2017. Big players such as DocuSign and EchoSign offer very simple to use and incorporate solutions. The addition of E-Signature into your price quote has the potential to reduce quote cycle time by 99% – the most important factor in sending a quote. A fast quote is a good quote.
7. 100% accuracy – Cannot be over stated. Again, double check. Make sure that everything above is included in the quote, and that everything included is 100% accurate. In inaccuracies caught will prove incompetence, and any that are left uncaught can product substantial problems down the line.