Leveraging CPQ Solutions for Global Sales Teams: Overcoming Localization Challenges

When you’re selling locally (that is, within your own country), there might be certain considerations from one area to the next. For example, if you’re a US business, selling to customers in California is a lot different from selling to customers in New York, Florida, or Texas.

But at least you’re using the same currency, operate under the same federal regulations, and have a relatively similar culture.

When you’re selling internationally, it’s a whole different ball game. Not only do you have to navigate different currencies, regulations, and levels of purchasing power, but you also have to consider cultural differences and language barriers.

Some of these things (like linguistic and cultural differences) can only be overcome with the right skills from your sales team.

The ones pertaining to your sales transactions?

You can streamline those with the help of CPQ (configure, price, quote) software.

Selling internationally is a lot different from selling in your local market.

You’re not dealing with the same government, regulations, or even societal norms. Each country has its own unique business landscape that requires a tailored approach.

Let’s take a look at some of the things you’ll have to consider, and how they’ll impact your sales process.

Language barriers

If the language of your sales team and customers isn’t aligned, it’s really easy to miscommunicate something. Miscommunications lead to incorrect product configurations and pricing errors, which is why you need multilingual capabilities in your CPQ.

Even when everyone is speaking the same language, terminology can vary greatly between regions. This is particularly important when dealing with products that have localized variations. For instance, a product might have a different name or specification in one country compared to another. Or, they may use a different word to refer to the same feature or function.

Some advanced CPQ systems offer features like language localization, where the interface and product descriptions are translated based on user preferences.

Value perception

You might not think about it right away, but language differences also affect how customers perceive your offer (and, by extension, your product). For example, certain terms used to describe discounts or promotions might be common in one region but not in another, leading to confusion.

A CPQ system that supports localized pricing guarantees the correct price is applied based on factors like local currency, taxes, tariffs, and shipping costs. It figures out these details on the spot, so your quote is immediately populated with the correct info.

By localizing not only the language but also the pricing structure, your sales team can offer more accurate, locally relevant quotes​.

Purchasing power

Purchasing power is a huge part of price optimization, even within your country’s borders.

So, when you’re selling internationally, you have to understand that people and businesses across the world aren’t operating under the same economic conditions. The cost of living and average income vary significantly around the world.

While this is more of a consideration for your pricing strategy, you can use pricing and sales data from your CPQ to inform your decisions on how to accommodate for different purchasing power in various markets.

Currency exchange rates

The value of one currency against the other fluctuates, which is why you need to factor in currency exchange rates when selling internationally.

This is relatively simple for currencies like the Euro or Pound, which have predictable exchange rates with the US dollar.

But, for plenty of currencies, it’s a lot more complicated — especially if you’re selling a subscription-based product/service.

A good CPQ system will automatically update currency exchange rates and calculate accurate pricing in real-time, so your sales rep can tell them what it’ll cost in their local currency without doing the math themselves.

Cultural nuances

Depending on where you’re selling, there may also be variations in usage or product preferences.

For instance, GE Healthcare developed portable ECG machines for rural India because they recognized that most hospitals couldn’t afford traditional equipment.

Customization and product adaptations extend to product configurations in CPQ systems, where local regulations and preferences can affect how products are assembled and priced. An example of this is right-hand drive cars, which are required for countries like the UK, India, and Japan.

Any automotive brands that want to sell into these markets will have to create additional configuration options to do so. And they’ll need their CPQ to automatically detect the location and adjust the available configurations accordingly to avoid mistakes.

Regulatory compliance

Ignoring regional regulations leads to fines, reputational damage, and loss of market access. You have a problem when selling the same product in the US and Europe, for instance (assuming you’ve done nothing to adapt it).

Say you’re a US-based manufacturer branching out into European markets. Products sold in the European Union must comply with the CE marking standard, which indicates that they meet EU safety, health, and environmental protection requirements.

For manufacturers, this involves adjusting products to meet specific technical and safety requirements, such as limiting hazardous substances (under the RoHS directive).

These changes can increase production costs, which are often passed on to customers through higher prices.

A CPQ system can account for these factors when generating quotes, so you’ll get an optimized price that accounts for these higher input costs.

Data privacy is another huge concern.

Around the world, you have different data privacy regulations, some more stringent than others.

This includes the EU’s General Data Protection Regulation (GDPR), which governs how businesses handle personal data of European citizens, and the California Consumer Privacy Act (CCPA), which protects residents’ personal information.

In the US, you have to comply with regulations like HIPAA for healthcare products and COPPA for selling to children.

While this may or may not directly impact your pricing or product configurations, you have to use sales tools (like CPQ) that comply with these regulations when collecting customer data during the sales process.

What it actually takes to localize pricing

Simply investing in CPQ software isn’t enough. To guarantee you get ROI from your CPQ solution as a multinational company, you have a few more important considerations.

1. Centralized platform with regional customization

You need to have a scalable CPQ system that supports multiple regions, and allows you to customize pricing and configurations for each market.

All your sales team members should be working within the same platform. And that platform needs to be able to accommodate different languages, currencies, and regulations.

2. Localized user interfaces

You also need to make sure your CPQ system’s user interface is localized, so reps can easily navigate and understand the software in their native language.

Consider:

• How certain words translate to different languages
• Date and time formats
• Numerical values (decimal points, commas)
• Cultural references or symbols that may not make sense in other regions

3. Product catalog localization

When a member logs in from their respective region or enters customer data indicating that’s where they’re selling into, the system has to automatically switch over to that market’s pricing and product catalog.

It needs to account for:

• Accurately translated descriptions and product specs
• Regional versions and configuration options
• Exclusive products that may be sold only in certain markets

4. Pricing and discount localization

Since you’re adapting your pricing for local input costs, purchasing power, and taxes, you need a system that automatically factors those variables in. This is where the CPQ system’s rules engine comes in handy.

You can set up specific pricing rules for each market, accounting for everything from currency exchange rates to local taxes and regulations.

When you program pricing rules into your backend (or another admin does), you can also add discounts for each region, minimum profit margins, and maximum discounts for reps to offer without approval.

5. Workflow and approval processes

For deals that do require approval (your high-value ones, or those involving custom products), approval routing is key for deal desk success.

Since some divisions of your company are probably larger than others (or, at the very least, set up differently), this means you’ll need to configure approval workflows at the regional level as well.

6. Training and support

Look for CPQ vendors that offer training and support in your regions. If the company only offers materials and support resources for one or a few of the regions you operate in, you’ll be stuck trying to train new hires yourself.

And if you ever run into an issue with the system, you might be out of luck. At best, you’ll wait an unreasonably long time for service.

As for your internal team, you need to hire reps who are well-versed in regional complexities. That way, they can sell more effectively into those markets, better understand the customer’s perspective and address their needs and concerns.

Benefits of using CPQ software for price localization

When you offload the hard parts of price localization to CPQ software, you put yourself at a tremendous advantage:

• Automated pricing and configuration adjustment per region
• Reduction in compliance risks and fines for not adapting to local regulations
• Streamlined process for approving high-value deals
• More accurate quotes that account for regional input costs and taxes
• Ability to train reps on CPQ software in their native language

According to data from CloudSense, CPQ reduces sales cycle times by 28% and cuts approval times by 95%. And Valorx says the average company sees a 40% reduction in human error throughout the quoting process after implementing CPQ.

When you improve sales efficiency, you’re also delivering a better customer experience. And that directly translates to higher win rates, more revenue, and increased customer satisfaction.

Support your global sales team with the power of CPQ

For global sales operations, having a centralized CPQ solution that supports localization is non-negotiable. It’s the only way to streamline compliance and deliver accurate quotes when conducting business across different regions.

When setting up your CPQ system, your pricing strategy will be the #1 concern. You need a strategic approach to localization that considers local purchasing power, currency exchange fluctuations, and varying input costs.

If you can accomplish those two things, you’re well on your way to successfully implementing a CPQ system that supports your multinational business. Looking for a CPQ solution to support international business deals? Check out my tips for selecting CPQ software. Also take a look at our CPQ reviews and the best CPQ comparisons.