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What is Quote-to-Cash?
Quote-to-Cash (QTC) is a sales and IT term. It refers to all the end-to-end steps involved in a sale, from sending a quote out to receiving payment. A subset of Quote-to-Cash is Trial-to-Cash (TTC), which adds a free trial to the QTC process.
Salesbricks automates and streamlines steps across QTC. For example, making a quote with Salesbricks only takes 5 minutes; 1,800% faster than a legacy CPQ solution. Managing trials and paid subscriptions takes minutes too.
On this page, we’ll cover what steps are involved in QTC, why QTC and TTC are important, and 5 QTC best practices for you and your organization. But first, we’ll cover…
What is Trial-to-Cash?
Most SaaS offer free trials. These free trials drive product usage, which drives revenue and referrals. That’s why it makes sense to expand the QTC term to include Trials.
The main difference between TTC and QTC is that TTC begins at the free trial. QTC starts with you configuring a quote, which is a more sales-focused approach.
QTC starts when a customer expresses interest in buying the product by requesting a quote.
TTC includes all steps taken in QTC since its main goal is to get a free trial user to buy the product. Since many SaaS sales teams use their products to attract new customers, TTC is quite common.
What are the 10 steps in Quote-to-Cash?
Offering a free trial
This step only happens in Trial-to-Cash processes. It consists of you offering users a free trial via self-serve quote pages (i.e. pricing pages).
If you use a PLG sales motion, which many SaaS companies do, you’ll likely be offering a free trial. It’s also likely that the first few steps of the QTC process - Configure, Price, and Quote - will happen on the user’s end, via self-serve mechanisms.
Product configuration
It’s time to determine the customer's needs and configure a product offer. This can either be on your sales team or on the end user, depending on your sales motion(s).
Either way, product configuration involves selecting features, settings, and options the customer wants. For instance, a VPN product may offer protocols, server locations, and levels of encryption at the configuration stage.
Pricing
Now it’s time to price the newly-configured product. Several factors affect the final price of the product. These include the features included in a configuration, payment terms, applicable discounts, and more.
In sales-led motions, pricing is done by the sales team. In self-serve, bottom-up motions, pricing is usually calculated automatically.
Quoting
Once the product and price are set, it’s time for the user to get a quote. As with the previous two steps, this is either done automatically or via your sales team.
The first item on a quote is often the product description. It describes the product the customer will receive, including how it works and the features included. Other items include the price, taxes, quantity, payment terms and methods, and delivery terms.
Negotiation
After a customer receives the quote, they may negotiate for better terms. This only applies to sales-led motions, not self-serve sales. Negotiable items include the product's price, add-on features, and payment terms.
This step may involve several revisions to the quote, which costs sales teams and customers a lot of time when dealing with dated quoting technology. Salesbricks solves this by providing interactive quotes that are easy and quick to amend to adhere to any agreed-upon new terms.
Contracting
After accepting a quote, it’s time to sign a contract. Contracts provide legal protection for both sides by clearly outlining the rights and responsibilities of the seller and buyer. This comes in handy in case of any breach of contract from either side.
The contract also ensures transparency of the purchase agreement and compliance with industry standards and regulations. If the customer agrees with the contract terms, they’ll render their signature.
Order processing
Order processing involves confirmation of the product to be sold, customer information, payment details, and pricing. Once the customer confirms the details as accurate, it’s time to collect payment and fulfill the order.
Billing
Billing starts with sending the customer an invoice for the product sold. This can happen via email or through an interactive page (e.g. a Salesbricks-made quote).
An invoice includes product information, quantity, unit price, the total amount due, due date, payment terms, and methods. It may also include an instant checkout form that helps people pay for their product.
Payment
After receiving the invoice, the customer pays for the product. This marks the end of the quote-to-cash process and indicates a successful sale.
Order fulfillment
It’s time to fulfill the order! This means providing the buyer with a license key, activation code, and/or download link. It also means sending out supporting documentation, like a confirmation of payment and onboarding documents.
Quote-to-cash best practices
Here are 5 ways to make your QTC processes smooth and frictionless for yourself and your users.
Choose the right QTC solution
A good solution automates large chunks of QTC. Without one, you’ll have to cobble your sales process together with standalone products, automations, and custom code.
This is expensive - but also problematic. For example, Salesbricks let you create quotes in minutes and manage any number of subscriptions with ease. Without a solution like this, you risk losing sales and revenue to slow quotes, wrongful billing, etc.
To find the right QTC technology for your business, consider factors like functionality, scalability, and user experience. To see how Salesbricks can help you and your business, book a free demo here.
Involve all stakeholders
QTC spans a number of departments, from sales to legal. Involve all stakeholders when deciding on QTC processes, workflows, and solutions. This way, all stakeholders will be on the same page, improving communication and minimizing errors.
Monitor and optimize
Continuously monitor your QTC processes and IT setup. Look for sources of friction and any problems that come up for users or your own team. When you find something, fix it - or look for new, better ways to improve on what you used to do.
Here’s an example. Let’s say you’re using legacy CPQ software to create quotes. If you notice that clients drop off around the quoting stage, consider using a solution like Salesbricks to make better quotes.
Choose optimal pricing models and strategies
Your pricing should make sense for both users and your business. This means two things.
First, you need the right pricing strategies - i.e. how much you’re charging. For example, if you’re in a niche with lots of players, competitive pricing makes sense. If you’re offering a unique solution, you have more freedom (including premium pricing).
It also matters that the specific pricing models you offer are both fair and affordable. For example, if you bill users by features or bandwidth used, they’re more likely to feel satisfied. Nobody wants to feel like they’re overpaying.
To learn more about pricing models, check out this article on pricing for SaaS products.
Standardize and automate
Many teams don’t understand just how much easier QTC tech can make their lives. Software like Salesbricks can automate entitlements management, subscription management, and quote creation. It can also create guardrails that guide your sales team towards closing deals.
The specific automations available to you may vary. But so long as you use software to proactively automate sales-side operations, you maximize the value you get from QTC flows and solutions.
The best QTC solution for your business
Salesbricks exists to make QTC as easy as possible, hugely reducing both the time and effort your team spends on the process. It automates several QTC steps, including:
- Pricing
- Quoting
- Payments
we do here at Salesbricks.
Our founders, Jon Fastejo and JL Swaine, made Salesbricks to do all this in a few minutes after having enough of managing over $2 billion in sales contracts using dated software that took ages to generate quotes.
Salesbricks could be the best QTC solution for your business–book a demo, and we’ll show you why.
