NetSuite solutions architect at Fusion5, Jarrod Tuxworth, discusses a software that transforms the sales process of custom-built products.
Specialising in project management and software solutions, Fusion5 offers professional services across many different business applications. One of the company’s key integrations and most sought-after packages is NetSuite, an ERP [Enterprise Resource Planning] system for medium-sized business.
“NetSuite is one of the pillars of Fusion5,” said NetSuite solutions architect, Jarrod Tuxworth.
Despite working across many business verticals, a strong point of NetSuite’s software is make-to-order or custom-build manufacturing. The solution at the core of this feature is NetSuite’s CPQ [Configure, Price, Quote] platform. This tool is aimed at helping businesses streamline the processes behind customised products, as well as determine their price and generate quotes for customers.
“The system uses a series of questions for the user to configure a custom product. We then determine a price and finally we can generate a bespoke quote document for that customer,” said Tuxworth. “There’s a bunch of automation that then flows from this, including the automatic creation of the bill of materials (BOM) and routing and item records.”
In the context of manufacturing, CPQ plays a vital role in simplifying the sales process for complex products that can have multiple configurations and pricing variables including style, material and colour.
“When you’re selling a custom product, everything that you build is unique or close to it. It’s very resource intensive to provide a quote for every potential product,” said Tuxworth.
Tuxworth said the CPQ System comes as a productive alternative to the time-consuming and error ridden reality of traditional methods.
“That’s a lot of effort if you’re doing it all in Excel, and there’s always the chance of error,” he said. “There’s also a lack of validation. This often leads to a lot of quotes being issued for products that you can’t build.”
Exploring the effectiveness of CPQ
In what is a multi-layered solution, Tuxworth covered each step of a system that combines technology and expertise to deliver hassle-free, built-to-order products.
Because these products often come with various features, options, and specifications, the first step is configuration. This allows customers or salespeople to choose the specific attributes of the product being manufactured.
“Configuration is where the user is going to be guided through all of the questions that the system requires to end up with the design of a valid
product,” said Tuxworth. “There’s different types of questions used, from simple radials and lists, text boxes, image-based selections to pop-up
modal windows and tables.”
The CPQ system ensures configuration involves selecting components or parts that are compatible with one another so the final product is feasible to produce. Tuxworth said the solution is living proof that a product being too specific or too abstract doesn’t exist.
“You can build it to encompass virtually an unlimited number of scenarios,” said Tuxworth. “Everyone thinks that their product is too big or too unique or too special. But the answer is always yes, you can build it.”
While the solution sometimes requires guidance, Fusion5 offers expertise and skill that – in tandem with the customer’s product knowledge – proves to be beneficial.
“Combining our capable staff with customers and key stakeholders means we normally get to very nice solutions,” said Tuxworth.
After the configuration phase is complete, NetSuite’s CPQ solution automatically calculates the price based on factors like the cost of materials, labour, production time, shipping, and discounts or promotions.
“The NetSuite CPQ pricing engine works off rules-based logic,” said Tuxworth.
The system can even ensure consistency through adaptation to a company’s pricing rules, with variations surfacing from volume discounts, customer-specific pricing, or regional pricing differences.
“Everyone’s using the same tool in the same system, so you’re not worried about having multiple different versions of an Excel file or having the latest data in that file from the ERP,” said Tuxworth. “You’re getting live data from NetSuite every single time you launch the Configurator. It’s critical to ensure the same rules are applied across all sales channels.”
Additionally, Tuxworth noted ‘resolving data’ as an important concept that takes a very simple solution and makes it powerful enough to price anything.
“If you’ve got 1000 raw materials that could be selected and form part of your build, and you want to include the cost as part of your pricing, rather than needing a price rule for every single raw material, we resolve that price,” he said. “We do this by saying ‘here’s the item that we need based on answers from the configuration process,’ and then we lookup the cost of that particular item.’”
Once configured and priced, the CPQ system generates a formal quote that details the product’s specifications and price. The document can be used by the sales team or sent directly to the customer, and may include other critical details, such as lead times, delivery schedules, and terms of sale.
“The easiest way to think about this is just a robust PDF generation template,” said Tuxworth.
Putting words into action
With an automated focus on attention to detail, Tuxworth said that CPQ helps manufacturing businesses efficiently provide customers with accurate pricing and timely quotes.
“The fact that you can build your BOM, and routing automatically makes things more efficient and accurate. You save a lot of resource time,” he said.
Additionally, he said the solution’s accuracy prevents the errors many businesses make, and in turn increases the professionalism of business operations dramatically.
“You’re not going to be accidentally committing to a price that is too low or giving a price that’s too high and losing business because of it,” said Tuxworth.
The solution also integrates with ERP and CRM systems to provide a flow of information across the sales, manufacturing, and finance departments.
“One of the big advantages is the fact that it is sitting there right on the ERP platform. It’s running on the same database as the rest of your ERP,” said Tuxworth.
Coming from a manufacturing background, Tuxworth is one of the many NetSuite solutions architects that brings their broad experience to focus a NetSuite system to suit the customer’s business needs.
“I’ve taken my experience as the head of business operations for a large global manufacturer to my time at Fusion5, where I’ve implemented CPQ for many customers now,” he said.
Tuxworth recalled a time and place where Fusion5 integrated NetSuite’s CPQ system for the complex and unique products for a retail signage manufacturer. The company believes the system was built for this type of application.
“Retail signs like those along a highway, and different illuminated signs on big pylons, are actually very complex and unique things to build,” he said. “Some unique challenges were able to be solved with that one.”
Tuxworth said that finally being able to build out that logic really showed Fusion5 and the client just how far a CPQ system can take a project.
“The CPQ has taken their entire business to another level. It’s a wonderful use case for a company getting the full benefits out of the solution,” he said.
talk to a NetSuite expert
In what is a system that already taps into different automated technologies, Tuxworth is excited about the prospect of artificial intelligence and what it could do for the further development of solutions like CPQ.
“AI is going to be enormously beneficial in the CPQ space, because when I can track configuration data across thousands of product builds that have been done, I can get some hugely valuable insights from that data,” he said.
“In NetSuite, it’s everywhere already.”