Quote to Cash (QTC or Q2C) is an information technology term that can be defined as the entire process chain of a trading company, from the creation of the initial quotes to the final payment.
A sales negotiation consists of several phases, such as: Quote configuration, development of the appropriate price, proposal preparation, negotiation with the buyer, contract preparation, invoicing, payment, in addition to the possible contract extensions and renegotiations that always occur. The Quote to Cash system is designed to facilitate this entire process in a simple, technological and automated way, contributing to greater efficiency, accuracy and visibility of all stages of a negotiation.
What is Quote to Cash about?
The quote-to-cash sequence is a series of business processes that begins with providing initial quotes to customers and ends with payment and collection. It often includes the ability to renew the sales cycle with customers and provides the opportunity for insight, customer engagement and subsequent interactivity throughout the process. “Quote to Cash” is something that most companies are already implementing, but not all companies are doing it well. To ensure real and lasting value, the Quote to Cash solution needs to be thought through from the start. But how do businesses get there?
The ideal is a business process that brings together the essential parts that support the customer journey into a single cohesive whole. At the top, it must enable a continuous flow through its trading, sales, service and marketing functions and continue into its core back-end financial systems and enterprise resource planning (EPR). This holistic approach helps companies build relationships of trust and retain and win customers over the long term.
What does this mean for the subscription economy?
Quote to Cash consists of the integration of the Configure, Price, Quote (CPQ), Contract Life Cycle Management and Revenue Management solutions. But what exactly is CPQ and what does it mean for the subscription economy? CPQ (Configure, Price, Quote) software is a term used in the B2B industry to describe software systems that help vendors offer complex, configurable products. Especially in the cloud and subscription economy, an automated quote-to-cash system is therefore the only viable solution to map the entire sales process chain.
Advantages of the Quote to Cash solution
Q2C can increase sales efficiency and effectiveness by enabling sales staff, partners and customers to quickly configure, refine and quote even the most complex products and services, thereby increasing business scale, shortening sales cycles and increasing revenue from existing customers. It also ensures compliance and eliminates risk by informing legal and finance of existing barriers and revenue risks. Teams have the autonomy to reduce revenue leakage, legal risks and operational costs through comprehensive contract lifecycle management capabilities.
An integrated Q2C solution enables revenue control by ensuring 100% accurate EPR data. This allows you to optimise revenue by managing future deal structures, renewals, payment terms, financial structures and contract compliance.
Conclusion: Q2C can facilitate the process, the interaction of the participants and the agility of a negotiation
A good Quote to Cash solution enables the centralisation of the entire revenue process, providing an integrated view of all customers, quotes and contracts across a company’s sales, legal, operations and finance functions. In this way, the entire company organisation has the visibility it needs to optimise revenue growth, reduce errors and delays, and improve customer retention. Especially in the dynamic subscription business, an automated response to internal and external business processes is essential to a company’s success and should therefore be considered, particularly for start-ups in the SaaS and other Cloud ventures.