A Comprehensive Guide to Completing the Quote to Cash Process the Right Way

quote to cash process

The sales process is all about converting a prospect into a revenue generator. A streamlined quote-to-cash process can make all the difference in converting an opportunity to revenue efficiently and quickly. Is your quote-to-cash workflow a broken one or is it a streamlined workflow that connects the sales, accounts, billing, order fulfillment, and accounts receivable functions, seamlessly?

This blog throws light on the quote-to-cash business process, and quote-to-cash process steps, and evaluates the effectiveness of quote-to-cash automation.

Understanding the Quote to Cash (Q2C) Process

The quote-to-cash process (Q2C) encompasses many functions across sales, account management, order fulfilment, billing, and accounts receivable departments. All the steps taken by the sales team to configure a quote and draft proposals for a client, until payment is received for rendered services, make up the quote to cash process.

What is the Quote-to-Cash Process?

The process that covers the end-to-end functions related to sales activity is called the quote-to-cash process. All the activities undertaken by the sales team from the moment they configure and deliver a proposal to the analysis of each step in the workflow are classified as the quote to cash process. Completing the Q2C process requires close collaboration between teams in sales, operations, accounting, and order fulfilment. 

Typically, configuring offers for a prospect is considered the first step in the quote-to-cash process. While there are several sales activities that occur along with marketing functions earlier in the marketing funnel, the opportunity to deliver a quote is considered the first measurable, concrete Q2C function.

The quote-to-cash process spans all the way until the cash for the sale in question has been collected and allocated, and data for all the points of the process have been analyzed and used to improve performance. It is important to distinguish the end point from the moment people assume the sales process is over. The sales process is complete only when the cash has been applied and the entire cycle is reported and analyzed. 

The quote-to-cash process is made up of several customer-centric processes that span several departments. Operating these activities in a siloed manner leads to many inefficiencies that could cost you significantly. Integrating and streamlining the quote-to-cash process is no longer an option but a necessity.

Steps in the Quote to Cash (Q2C) Process

Taking measures on how to improve the quote-to-cash process requires a good understanding of the steps that make up the process. The quote-to-cash process is made up of the following 10 steps.

1. Offer configuration

Configuring the quote is the first step in the Q2C process. In this step, the salesperson comes up with a quote for the prospect based on the information already recorded. The quicker the offer configuration process, the better the chances of capturing the prospect. It is also important to ensure that the information is error-free. 

2. Pricing

Pricing the quote is critical for successful customer relationships, hence, the sales team needs to be accurate and timely while preparing the quote. Sometimes, quote pricing may involve multiple layers, like promotions, discounts, and add-ons. Or it could be straightforward, without involving any levels or layers. Irrespective of the nature of the pricing process, the team needs to carry out the process quickly because the sale goes to whoever responds fastest. 

3. Quote creation

Once the price of the quote is decided by the sales department, a detailed quote report is presented to the prospect. The quote report must furnish all the information necessary for the sale. 

4. Contract management

Upon receiving the detailed quote from the sales, the customer accepts it if satisfied. Once the customer accepts it, a formal proposal is crafted. The contract must be well thought-out and free of any errors to ensure that the contract is signed immediately, instead of having to wait. Accurate creation of the contract helps the sales team capture the deal details and allows for visibility from stakeholders.

Contract negotiation is the next step. The terms and clauses in the contract must be easily understood and flexible to changes as and when needed. After the contract is negotiated, the next step is to obtain approvals from the stakeholders for the final sign-off of the contract.

5. Order fulfillment and management

Only those orders that can be fulfilled should be accepted by the organization. Manual verification for order fulfilment and management can be a cumbersome process. Automating this step in the quote-to-cash process ensures that order management and order fulfilment happen systematically, where only those orders that can be fulfilled alone are accepted by the organization. These automated systems make sure that completed proposals and contracts trigger subsequent activities like billing and other finance-related activities.

6. Billing and invoicing

The account receivable department takes over once the quote is completed. A detailed invoice is promptly prepared and sent to minimize delays in payments. Any delay in invoice fulfilment could curtail the cash flow within the organization. Automating this step delivers necessary information on time, even without the need to understand the intricacies of the sales. 

7. Revenue recognition

Finance teams need to accurately recognize the revenue for financial reporting integrity. In cases where the payment is of recurring nature, it becomes all the more important to adhere to an accurate recognition of income to show precise profits and losses. When payment is accurately recognized, financial forecasting and revenue projects are simplified. 

8. Renewal

Contract renewals and re-purchase of products can be done by the customer at this stage. On the other hand, the company may also decide to cross-sell or upsell to the customer at the renewal stage. The sales team must leverage the data about the customer provided by the system to maximize the customer’s lifetime value. 

9. Data analysis

The data for all the points relevant to the process must be analyzed. Once all points are analyzed, they must be reported as well. 

10. Process improvement

Once the points about the process are gathered and analyzed, the next step is to use the data for improving the process. The data points can be used to make the next sale more efficient and profitable. 

Common Challenges in the Quote to Cash Process

What seems like a fairly straightforward workflow, can be complicated or delayed when it is not streamlined with the right tools. Many businesses struggle to streamline their quote-to-cash process, which leads to several challenges. This affects the business bottom line negatively owing to missed opportunities, delayed payments, and poor customer experience.

Let us look at some of the most common challenges in the Q2C process.

Inability to create competitive quotes

Not all the quotes that are created become purchases, owing to ineffective pricing strategies. When the sales team cannot come up with a competitive or error-free quote, the result is a loss of business prospects. The right pricing strategy and automated processes aid the sales team in creating a well-thought-out, competitive quote.

Error-ridden invoices

When the working methodology of the accounts department is to understand every sale in detail before commencing the billing process, it may lead to delays in receiving payments. When payments are delayed, the organization’s cash flow is also proportionally diminished. In the event that invoices are inaccurate, they are returned by customers and the sales team checks the process to identify the issue.

Inaccurate revenue recognition

Handling all the revenue recognition exercises manually can be a tedious process that is riddled with errors. You may declare the wrong profit or loss, which results in inaccurate revenue projections.

Delayed payments

When the quote-to-cash process is not streamlined and integrated, the chance of errors is high. Inaccurate or overpriced invoices are returned by customers for corrections, which leads to the sales team spending time to correct the errors. Additionally, the accounting department has to keenly go through each invoice while comparing it with the available records to spot the error.

Dissatisfied customers

The most effective way to differentiate your business from competition is to maintain strong customer relationships. When you rely solely on manual processes, the likelihood of delays and errors is high, and you are left with disgruntled customers. Customer dissatisfaction also causes a negative impact on other prospects as well.

Missed Upsell and Cross-sell opportunities

When the customer experience is compromised in a business and the sales cycles are long, the chances of missed cross-sell and upsell opportunities are very high. This affects the business’s bottom line and the cash flow to run the business.

Streamlining the Quote to Cash (Q2C) Process

Customer-centric tasks like the quote-to-cash process are interdependent and must be integrated into a single business process with the right software. The right software helps create a single platform from which customer data can be collected, processed, and updated in real-time to empower sales reps to engage clients more effectively.

The most effective way to streamline is to automate quote to cash process. In fact, automation can be considered the foundation of an efficient quote-to-cash process. With automation, it is possible for teams to quickly and accurately go through all the tasks in the quote-to-cash process.

An effective workflow automation software like Cflow can streamline the team’s workflow accelerate the time to revenue and improve operational efficiency.

Quote to cash automation

  • Eliminates manual quoting processes and drives better selling behaviours
  • Empowers the sales steams to configure complex products and services, deliver accurate quotes, and create smarter goals
  • Enables teams to quickly build customized, personalized, and branded documents
  • Eliminates manual document tasks to minimize errors, improve tracking, and enhance customer experience
  • Streamlines and automates the contracting process to accelerate the revenue cycle
  • Enables better control over contract terms and clauses for effective risk mitigation

Quote to Cash (Q2C) Automation Tips

By employing a quote-to-cash automation solution, managing all the individual actions that make up the workflow can be taken care of easily. A workflow automation solution like Cflow enables salespeople to deliver accurate information to clients quickly and easily. When you automate the quote-to-cash process, the order and invoicing errors are eliminated and the data analysis and forecasting efforts are rendered more effective.

Here are a few tips for effective quote-to-cash automation:

Configure the sales offer

The first step in the Q2C process is configuring the sales offer, which is when a salesperson takes the first action toward building a quote for the client. This is a very important part of the process, which cannot afford any inconsistencies or inaccuracies. Automated Q2C systems eliminate the guesswork from the quote configuration process for the salespeople. Using software will accelerate the front end of the process and impose a series of controls to ensure quality and consistency.

Develop offer price and quote

When salespeople are thorough, accurate, and timely with their sales quotes, almost every sales quote can be converted into a purchase. Whether the pricing process is simple or complex, sales teams must be able to deliver an accurate quote quickly. Using a quote order to cash automation software enables salespeople to engage the customer with a quote confidently in an instant. The software updates the data in real-time throughout the systems, so that you can be confident that your customers will receive accurate and updated information.

Draft the proposal and agreement

Despite having all the information for preparing the proposal ready, there is still a risk of producing error-borne documents. Typos overlooks, or simple formatting mistakes may loom into a huge financial crisis. Automated proposals are far more accurate and consistent than manual ones. Automation allows salespeople to create dynamic proposals that are constructed from hundreds and thousands of distinct data points.

Process the order

The journey of a sale to a proposal involves data entry at multiple stages. A Q2C software integrates the entire order processing so that executed proposals and contracts immediately trigger actions on the Finance and fulfilment end.

End-to-end workflow automation

Build fully-customizable, no code process workflows in a jiffy.

The Benefits of Automating the Quote to Cash (Q2C) Process?

Streamlining the quote-to-cash process is beneficial for any business. It enables the business to overcome the challenges of a manual process and improves the efficiency of the process.

Here are some of the other benefits that automation brings to the quote-to-cash process.

1. Improve sales systems

The main intent of automating any business workflow is to improve its performance. When the quote-to-cash process is automated, all the redundant steps are eliminated, and what remains is a streamlined process that achieves high productivity levels. Quote to cash automation eliminates the silos that exist in different departments, which enables seamless communication between them. When all the departments talk to each other freely, business operations are greatly improved. Sales automation also reduces the length of the sales cycle, which leads to more revenue gain and a superior customer experience.

2. Identify sales opportunities

An automated sales process provides real-time data to the team regarding the quotes. Armed with data, sales reps can make more detailed and accurate quotes. They can also identify potential opportunities for upselling and cross-selling with access to the right data.

3. Minimizing quoting errors

Any process that is driven by human effort is prone to errors and miscalculations. Automating the quote to cash process eliminates human involvement in data-intensive tasks and, hence, brings down the error margins considerably. Reduced errors mean that you have a better chance to convert more prospects into paying customers. The need for repeated reviews and revisions is also considerably reduced through automation.

4. Minimizing order and invoicing errors

When human involvement in data-intensive tasks like order and invoice processing is minimized, data-related errors are automatically eliminated. Automating quote and invoice preparation brings down the errors in these processes to nil. Moreover, departments can share real-time data, and actions in one department automatically trigger actions in others in an automated quote-to-cash process.

5. Improving customer engagement and retention

Providing a good customer experience is paramount for any organization. And the best way to improve customer experience is to automate labour and data-intensive internal processes for better outcomes. Automation accelerates the sales process and shortens the sales cycle, much to the delight of customers. Automated processes enable timely communications and collaboration between team members and external stakeholders, which eventually improves customer experience.

6. Boosts revenue

Streamlining and integrating the sales process using workflow automation tools helps sales personnel leverage all the upsell and cross-sell opportunities early. The successful signing of customers boosts the revenue of the organization with minimal effort and costs.

Using a workflow management system like Cflow makes it easy and simple to manage the quote-to-cash workflow. Cflow is a cloud BPM that provides fully customizable workflows that you can create using visual form designers. This software equips the sales team with the right tool set to create process workflows for any type of business process


The quote-to-cash process is a labour and data-intensive process that needs clear communication and collaboration between tasks for the successful creation of quotes. Quote-to-cash automation is one of the most effective ways of streamlining the quote-to-cash business process.

Automating the process effectively requires a feature-rich no-code workflow automation platform like Cflow. The visual form designer in Cflow makes it super easy to create workflows even for citizen developers. You only have to drag and drop workflow elements to create workflows in Cflow. To explore Cflow you can sign up for the free trial right away.


Q-What are the 3 layers of the quote to cash?

A- The 3 layers of QTC are CPQ, contract management, and revenue management. All the processes involved in the quote-to-cash process are covered within these layers. 

Q-What is the quote-to-cash strategy?

A- End-to-end business processes related to the sales lifecycle are part of the quote-to-cash process. Organizations use a quote-to-cash strategy to improve subsequent sales cycles. 

Q-What is the quote to cash in SAP?

A- The quote-to-cash process covers all the business processes, from preparing a quote to payment of revenue for the product.

Q-What is the difference between quote to cash versus order to cash?

A- The order-to-cash process involves everything from when a customer places an order to receiving payment. The quote-to-cash process encompasses order-to-cash processes and configures price, quote, and contract management. Q2C spans from a customer’s intent, and purchase to realizing revenue. The order-to-cash process includes fulfilment and back-end ERP like invoicing and recording revenue.

Q-What is the difference between quote to cash versus CPQ?

A – CPQ software helps companies generate competitive quotes for prospects, while QTC goes beyond quotes into contract and revenue management.

What would you like to do next?​

Automate your workflows with our Cflow experts.​

Get your workflows automated for FREE

    By submitting this form, you agree to our terms of service and privacy policy.

    • Platform
    • Features
    • Workflow Templates
    • Quick Demo