Tips and Tricks

Why and how to analyze the effectiveness of price quotes?

In both small and large businesses, a freelancer or company generates tens to hundreds of offers a year. This is not uncommon, but more offers generated means more room for their analysis and higher possibility to increase the percentage of their acceptance.

At the end of the day more offers received, means more orders – the goal of every business that wants to grow. However, let’s take a look at what the price quote process consists of and how to optimize it.

To begin with, we need to know what parameters enter the bid creation process. For the vast majority of entrepreneurs, these are the most common:

  • Time – estimated time spent on the project / product (eg. number of people, their hours on the project and average hourly rate)
  • Resources – estimated cost of resources, services, and commodities directly for the project or as a calculated operating costs (eg. input price of materials, servers, rent, …)
  • Subcontractors – estimated price from your suppliers and 3rd parties
  • Unplanned expenses – unplanned project expenditures, especially for projects that are implemented over a longer period of time (so-called buffer), inflation, market fluctuations, etc.
  • Taxes – mandatory for every entrepreneur
  • Margin – high enough to generate profit while maintaining basic market competitiveness

Depending on the type of business, the values ​​of these inputs change over time. They are updated and recalculated for each individual offer, several times a year, in the event of significant changes in the market, or for each client individually.

However, the dynamics of input data for quotations usually ends there. Of course, the competitiveness of the quote itself is one of the basic parameters that generally determine if a price quote is usable in the real market at all. However, general market research helps with this.

It is not always possible for all the above-mentioned inputs to be directly or indirectly influenced so that the supply is high-quality, fast, cheap and profitable, ie it absolutely eliminates any competitive offer.

So how do you increase bid acceptance without changing inputs?

Simply put, analytics. But before we look at how it’s done, we have to define what the effectiveness of the offer really is.

Let’s say you prepare 100 offers a year for your business. Of these, 40 are accepted. So your efficiency is 40%. It takes you an average of 4 hours to prepare one quote.

Number of bids created / number of accepted bids =% effectiveness of your bids

Cost effectiveness

Effective hours used: 160 (40 * 4)

Inefficient hours used: 240 (60 * 4)

Thus, 30 working days (for calculation purposes, 1 working day = 8 hours) are wasted. It’s time spent on quotes that didn’t bring you any real business. Of course, this is not a completely burnt time, because by preparing the quotes, you learn how to make them better, more accurate and produce them faster. However, it will always take a bunch of your time. This time would have a higher value if you invoiced it directly to the client for a specific job or service in which you and your company are specialists.

If we want to create price offers more efficiently, we must therefore optimize the entire so-called funnel (user path) of the customer. But what does that mean for the lifecycle of a general price quote?

Number of addressed clients / requests for an offer (contact) -> Number of created offers (entry) -> Number of open offers / considered offers (selection) -> Number of answers / requests for additional information (detail) -> Number of accepted offers (goal).

However, if you do not have a system, automation and analytics for price quotes, the whole process is only manual. It’s very difficult to evaluate objectively and statistically at all these levels..

However, if you create these offers automatically, you can not only save time on their creation but also reach and satisfy many times more potential clients. 100% efficiency? Almost. You need time to create the initial logic and you will need to update the input parameters from time to time. Nevertheless, the longer you run this automation, the more advantageous and efficient it will be for your business. You get more time for your work and reach more potential customers (leads) in a fraction of the time. Win, win.

Decide on the basis of data thanks to their analysis

Toto je práve špecialita Bondly. Zobrazte a analyzujte potenciálnych zákazníkov pomocou prehľadov Analytics. Vyhodnocujte parametre ako miera otvorenia ponúk, stratení vs. získaní potenciálni zákazníci, miera dokončenia obchodného prípadu, priem. čas dokončenia zákazky, zdroj návštevy cenových ponúk, ich história a ďalšie. Všetky spoločne, vám pomôžu hlbšie pochopiť vašu výkonnosť a optimalizovať ju pre ešte lepšie konverzie.

This is Bondly’s specialty. View and analyze leads with analytics reports. Evaluate parameters such as open rate, lost vs. acquired potential customers, business case completion rate, avg. the time of completion, the source of the visit, price quote history and more. All together, automation and analytics will help you gain a deeper understanding of your performance and optimize it for even better conversions.

You can also analyze all the data from the responses in one simple table using custom filters.

What is Bondly?

Bondly is a template and quote creation tool that not only effectively automates this part of the pre-sales process but also allows you to manage and increase your sales conversion rate in an easy to use CRM. Simple but effective.

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