Quote-To-Cash vs. CPQ Software: What’s the Difference for SaaS Startups?

Jon Festejo

Co-Founder / CEO

Salesbricks

As your SaaS startup starts gaining traction, managing sales processes becomes a lot more complicated—especially with more products, varied pricing, and diverse customer needs.

That's where CPQ (Configure, Price, Quote)and quote-to-cash software come in handy. These solutions help you handle the quoting, billing, payment processing, and more so that you can focus your energy on closing deals.

But what exactly are these two software and what is the difference between them? Well, that’s exactly what we’ll cover in this article, so stay tuned.

What’s the difference between CPQ and quote-to-cash?

While CPQ software focuses specifically on the configuration, pricing, and quoting stages of the sales process, quote-to-cash covers the entire journey from the initial quote all the way to payment collection.

Essentially, CPQ is an integral part of the broader quote-to-cash process, handling the upfront sales tasks, while quote-to-cash software manages everything from sales to revenue. It therefore helps simplify and standardize the final mile of the sales process to close more deals faster.

What is CPQ software?

CPQ software helps sellers configure quotes for their customers quickly. For SaaS startups, it can help determine accurate pricing for tiered, usage-based, or other complex pricing structures. This means fewer errors and quicker responses to customers. This efficiency is especially important as your business grows, your sales velocity speeds up, and your product offerings become more complex.

In addition, CPQ software ensures that your pricing is consistent and transparent, which builds trust with customers. It also makes it easier to customize offerings to meet specific customer needs, helping you close more deals and drive revenue growth.

Pros of CPQ software for SaaS startups:

There are many benefits of CPQ for young SaaS startups. Here are a few of them:

Improve sales efficiency: Speeds up the quoting process, allowing your sales team to close deals faster.
Improves accuracy: Reduces errors in quote configuration and pricing, ensuring customers get exactly what they expect.
Speeds up sales cycles: Streamlines the process for buyers and sellers, cutting down the time from lead to sale.
Makes upselling easier: Learning customer purchasing patterns can help your sales team recommend additional products or upgrades at the right moment.

Cons of CPQ software for SaaS startups:

Like any software solution, there are downsides

Costs: Initial setup can be pricey, depending on the solution.
Hard to use: Your team will need time to learn the ropes, which can slow things down initially.

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What is quote-to-cash software?

Quote-to-cash software covers everything from generating a quote to closing the deal and collecting payment. This basically means it covers the entire journey from the moment a customer shows interest until the cash hits your bank account.

Quote-to-cash software helps businesses with managing, processing, and executing their sales, billing, and revenue streams effortlessly.

Pros of quote-to-cash software for SaaS startups:

There are many benefits of quote-to-cash software. Here are some of the biggies:

Complex deal shaping: Increases win rates with more freedom to shape deals exactly as you want them.
Streamlined efficiency: Because everything is integrated, your sales process can become smoother and faster, which is a huge plus for both buyers and sellers.
Reduced churn: By managing the entire customer lifecycle, you gain better insight into your customers and can therefore address issues before they lead to cancellations.
Better invoicing: Automates invoicing and payment processes, reducing errors and improving cash flow.

Cons of quote-to-cash software for SaaS startups:

With everything, there’s pros and cons. Here’s what to look out for when choosing a quote-to-cash software:

Complex implementation: Some solutions — especially if they aren’t built for startups — can be a bit of a beast to set up initially, requiring significant time and resources.
Integration challenges: Ensuring it works well with your existing systems might need some extra elbow grease.

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Which is better for SaaS startups, CPQ or quote-to-cash software?

Choosing between CPQ and quote-to-cash depends on your business needs. If you’re looking to streamline your sales process and handle complex product configurations, CPQ might be your best bet. However, if you need an end-to-end solution that covers everything from sales to cash collection, quote-to-cash could be more suitable.

However, because quote-to-cash software includes all the functionality of CPQ software, it could be a good idea to choose a quote-to-cash solution that is low cost, easy-to-use and built for startups (like Salesbricks). This way you have the option to use what you want and minimize the number of software you will need to onboard if you decide late you want a quote-to-cash solution.

But ultimately, the best choice will depend on your specific requirements and growth plans.

If you’re interested in learning more about how Salesbricks can help your SaaS startup grow, let’s chat.