In previous articles/videos, we learnt about lead conversion and the creation of account, contact and opportunity objects in Salesforce. This article/video will shed light on product, price book and opportunity management in Salesforce.
What is product and price book management in Salesforce?
Salesforce provides separate tabs to capture and store product and price details. They are known as product aProduct, Price Book and Opportunity Management in Salesforce
nd price book.
Product
Product is an object where you can record all your product offerings with standard prices. The product can be either a service or an item you offer to your customers.
All the products you offer can be viewed from the Products tab.
Price Book
A price book is an object that allows you to add variations in the standard pricing of the products. It is a list of products offered with associated prices. Each product and price book entry consists of a product and its price. One price book entry is a combination of a product and its price.
Prices of a product change due to many reasons. Some of them are festival offers, special discounts, discounts on a bulk order, discounts for referrals etc. You may offer the same product at different prices to different customers. Salesforce makes it easy to capture all the different products and prices with its product and price book features.
The price book consists of two parts- Standard Price Book and Custom Price Book. The standard price book is the master list of all products and services offered by the business and the custom price book which are additional price books created as per the requirement of the business.
One product can be part of multiple price books, and multiple products can be tagged to a single price book.
For example, A business has products like- GST automation software, Expense management software etc. and price books like- Thanksgiving day, Diwali, 10% discounted price, 20 % discounted price etc.
Let’s assume the following:
A company, who is using salesforce, offers 2 softwares. Each product has a standard price. The standard price of a GST automation software product is $100, and expense management software is $70.
The price book Thanksgiving Day consists of a 10% discount while the price book Diwali is for a 20% discount. It means the same product can have different prices apart from the Standard price mentioned.
The price book Thanksgiving Day can be tagged to both GST automation software and expense management software (Which is the other product offered by the company.
While the product GST automation software can have both Thanksgiving Day and Diwali price books.
How to create a Product and Price Book in Salesforce?
Product and Price book are tabs available in the Sales Cloud of Salesforce. However, if you do not find product and price book tabs in the sales cloud, you can add them.
- Click on the Pencil at the right end of all the Tabs.
2. Click on Add more items.
3. Select All.
- Search for product and price book.
- Click on + button to check them.
- Add items and Save.
Creating a product in Salesforce
- Open the products tab
- Click on new
- Fill in the product details and Save.
- Go to related lists
- Add standard price (default currency in Salesforce is US Dollars)
Creating a price book in Salesforce
- Open the price book tab
- Click on new
- Fill in the details
Associating a product with a price book in Salesforce
You associate a product with a price book in two ways.
From the product page
- Click on Products Tab
- Go to related lists
- Click on Add new price book
- Fill in the details
From the price book page
- Click on the price book tab
- Go to related lists
- Click on Add new price book
- Fill in the details
You need to enter the list price when you associate the product with the price book.
Note- For a product to be tagged with a price book, the standard price of the product must be entered beforehand.
Opportunity Management in Salesforce
In Salesforce, an opportunity is an object that tracks the transaction with the customer or account. It tracks the status of the sale, which product is being sold, what is the expected revenue and much more. Opportunity also holds the product information related to a particular account.
Opportunity in Salesforce represents three things- sale closed, sale lost and potential of a future sale. Opportunity management is a process that enables you to manage the entire sales cycle of a particular account.
You can manage all the opportunities through the opportunity tab.
You can associate a product with the opportunity. On the right side of the opportunity detail page, you can see product details. Once you add the product details, you will observe a change in the expected revenue / Amount field on the opportunity detail page. Basically the products prices are calculated based on the quantity of products selected in the opportunity.
Opportunity has a stage and probability field that helps in a better understanding of expected revenue. Every stage of opportunity from prospecting to negotiating and closure, has a probability attached to it by default. Expected revenue is the probability percentage of the amount of sales expected.
For example, products worth $180 are attached to an opportunity. The opportunity is at the prospecting stage. The probability of the prospecting stage is 10%. Hence, the expected revenue will be $18.
If the opportunity was at the negotiating stage, whose probability is 90%, the expected revenue would be $172.
I hope this article/video gave you an overview of the product, price book and opportunity management in Salesforce. We will discuss more in further articles/videos.