How Salesforce Products and Price Books Work Together

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September 18, 2014

Salesforce Products & Price Books

[tweet_quote]Many companies run their inventory of products and services out of Salesforce.[/tweet_quote] This provides a complete view to the sales and marketing teams as it relates to what is in inventory, what customers have purchased and product specific information. But Salesforce products also provides the ability for sales people to quickly generate sales quotes with accurate product and service information. As defined by, Products are the individual items or services that you sell to customers through your opportunities and quotes.

Within products, Salesforce provides price books. “A price book is a list of products and their associated prices. Each product and its price is called a price book entry” as defined by When you combine price books and products, you are able to see the various products your company can provide along with the prices of the products. This helps to provide the payment and delivery cycle of the products needed to give companies a proper lifecycle prediction.

Defining the Products

A product is a service or item the company sells to the customers. After defining the products, you can associate them with the prices you have established in the price book. With Salesforce you will have layouts and custom fields to track which products are successful. Products can then be added to a Salesforce opportunity allowing you to have an ensure inventory and forecasting are accurate.

Price Books

The price book will provide a list of the products and the different prices for the products. Salesforce will provide standard and custom price books, making it easy to have multiple prices for a product. A standard price book will offer a master list of the products and their standard prices. This list will automatically list the standard prices and regardless of the custom price books that can include the varying prices.

Custom price books are different as they provide a list of custom list prices for the products. They will give you a price based on the varying segments they are part of in the market segments. A custom price book will have discounted price lists and list prices when they are priced higher from a standard price.

When do companies need to use the different price lists? A perfect example of when the differences often come when there are domestic orders and international orders. The international price book and domestic price book give you the different prices for the markets.

Price Book Entries

The price book entries give a basic format of the price for each product. Salesforce will take this number and provide you with two types of price book entries. One for a standard entry and another for a custom entry. A standard entry offers the default prices you use when selling a product. The custom entry is used to provide a list of the products sold at discount or for a different rate.

Correct Scheduling

Using Salesforce will allow for accurate scheduling of products. Failure to have the right payment and delivery cycle established can leave a company having a large inventory amount, or end up with backorders. Establishing pricing for a product gives you a chance to establish default schedules for the products. The default schedules will work when you have customers making timely payments. When you end up with customers that choose to make payments on a customized schedule, you need to chance the quantities ordered, revenue predictions, and other things to ensure product is made based on income. Establishing which schedules are used for different products will assist with revenue and product ordering.

What is a Quantity Schedule?

This is a great system to use if you have customers that pay on time, or pay all at once. They usually want to receive the product in increments including subscriptions monthly and so forth. A quantity schedule needs to set determined dates and number of products needed for delivery to set a proper payment and shipment system.

What is a Revenue Schedule?

The revenue schedule is different as it will have customers making regular payments, but they receive their products all at once. Using a system where you charge in installments and then deliver the products at once provides a recognizable revenue stream.

Using the Revenue and Quantity Schedule

If you have customers that receive an order on a set delivery date they will pay for the products on a payment schedule. The monthly product subscription and monthly delivery will give you the right satisfaction you need for the customers to be happy and to ensure you have a steady revenue stream.

Creating an Opportunity

With several picklists and different product offerings, the entire sales team will have an easier time selecting products for sales. Salesforce uses price books and products to create a unique system that is easier for everyone to understand and creates the right opportunities for sales to be made.

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