Quote-to-Order ERP Software Built for Manufacturers

An estimate in the context of custom manufacturing is an initial approximation or educated guess of what a particular job may cost. Since custom manufacturers do not have set pricelists, they must provide customers with an idea of what they can expect to pay for a specific project.

An estimate is essentially a ‘guesstimate’ provided early in the process, typically before all the details of the job are known. It serves as the first assessment of costs based on available information.

However, estimates are subject to change based on further details gathered, unexpected complications that may arise during the work, or changes in the scope of the project. Therefore, an estimate represents the initial thoughts on costs and can be revised as more information becomes available or circumstances evolve during the project execution.

A quote in the context of custom manufacturing is an exact price provided to the customer for a specific job or project. Unlike an estimate, a quote is a fixed amount and cannot be changed once it has been accepted by the customer, except in cases where there are changes to the amount or type of work required, or if unexpected issues arise outside the agreed scope.

Quotes are issued after careful consideration and confidence that all necessary details of the job have been established, including the costs involved. Since quotes represent the agreed-upon price for the work, it is crucial for manufacturers to have a clear understanding of job costs to provide accurate quotes. This ensures transparency and clarity between the manufacturer and the customer regarding the pricing and scope of the project.

Manufacturers can simplify the quoting process by implementing several strategies aimed at streamlining and optimizing the workflow. Here are some ways to achieve this:

• Standardize Templates: Create standardized templates for quotes that include essential information such as estimated cost, product descriptions, pricing details, terms and conditions, and contact information. Using templates ensures consistency and reduces the time required to create each quote. Standardized values for parts and raw materials will accelerate the process.
• Automate Quoting Process: Utilize software solutions or tools specifically designed for quoting and estimating to automate repetitive tasks and calculations. Automated systems can generate quotes quickly based on predefined parameters, reducing manual effort and minimizing errors. Whether you are quoting on parts or complete jobs, automation saves time.
• Centralize Data Management: Maintain a centralized database or system for storing product information, past estimates, pricing data, customer details, and historical quotes. Centralizing data allows easy access to relevant information, eliminates duplication, and ensures data accuracy across the organization.
• Implement Configurators: Use product configurators or quoting tools that enable customers or sales representatives to customize products and generate quotes in real-time. Configurators simplify the quoting process by guiding users through product options, features, and pricing variations. By utilizing CPQ tools – short for: Configure, Price, Quote, manufacturers can streamline and automate the quoting process for complex products or services. CPQ is a vital part of a good ERP.
• Integrate with CRM and ERP Systems: Integrate quoting tools with Customer Relationship Management (CRM) and Enterprise Resource Planning (ERP) systems to streamline data flow and ensure consistency across sales, quoting, and production processes. Integration eliminates manual data entry, improves accuracy, speeds estimating processes, and facilitates seamless information exchange.
• Streamline Approval Processes: Establish clear approval workflows and criteria for reviewing and approving quotes. Implement automated approval mechanisms where possible to expedite the approval process and avoid bottlenecks related to quoting and costs.
• Provide Training and Support: Offer training and support to sales teams, customer service representatives, and other staff involved in the quoting process. Ensure they are familiar with quoting tools, templates, and processes to maximize efficiency and accuracy.
• Monitor and Analyze Performance: Regularly monitor key metrics such as quote-to-close ratio, win rates, and average quote turnaround time to identify areas for improvement. Analyze cost and quote data to understand customer preferences, pricing trends, and competitive positioning, and use insights to refine quoting strategies.

By implementing these strategies, manufacturers can simplify the quoting process, reduce manual effort, improve accuracy, and enhance overall efficiency, ultimately leading to better customer experiences and increased sales effectiveness.