Generate a Renewal Opportunity for Forecasting
The good news is that you’ve sold Klein Manor two years of home security monitoring. Even better news: after the two years pass, they will probably want to continue their subscription. Salesforce CPQ can use information from the subscriptions on the current contract to quickly generate an opportunity that represents the renewal sale two years from now. This allows your sales team to forecast more accurately and simplify quoting in the future.
When sales reps first sell home security systems, they often add a $10 per year warranty, which is a subscription product sold on a yearly basis. However, when it’s time to renew subscriptions, AW Computing’s policy is not to sell the initial warranty again. Instead, they want customers to switch to a different subscription product named Warranty Extension for $15 per year. As an admin, you can make sure that happens automatically.
- Click Products from the navigation bar, then choose the All Product list view.
- Click Edit from the dropdown menu for the Warranty product.
- In the Renewal Product field, search for and select Warranty Extension.
- Click Save.
Although it will be two years before Klein Manor needs to renew its subscription services, you will create a renewal opportunity so that the sales team can forecast on the potential revenue. In this story, AW Computing has a policy of selling renewal subscriptions for just one year at a time, even though the initial contract may be two or more years. Let’s work through this as if we are on the Sales Operations team and complete these three tasks.
- Click Accounts from the navigation bar.
- Click Klein Manor.
- Click the Related tab.
- In the Contracts related list, click Edit from the dropdown menu of the one contract record.
By default, CPQ sets the Renewal Term to the length of the original quote term. However, per our company policy, we must set this to one year. We are not changing the Contract Term field! Leave that as 24.
- In the Renewal Term field, enter
- Check the Renewal Forecast checkbox.
This is the key field that tells Salesforce CPQ to generate a renewal opportunity.
- Click Save.
At this time, Salesforce CPQ is creating a renewal opportunity in the background, which takes only a few moments to complete.
- Click View All in the Opportunities related list.
- Click Renewal Opportunity.
This is the opportunity that Salesforce CPQ created automatically.
- Click Edit.
- In the Opportunity Name field, enter
Home security renewal.
This is simply to help us identify the opportunity more easily at a later date.
- Click Save.
Finally, let’s verify that the warranty product was swapped to the Warranty Extension product for the renewal.
- In the Products related list, click View All.
You should see that the Warranty Extension product is in the list of opportunity products with the updated price of $15, and the normal warranty is nowhere to be found.
Although the new opportunity may not be used for a few years, at least it’s here for the sake of forecasting. A lot can happen in two years, and it’s not unusual for customers to ask for changes to their ongoing subscriptions. If we make an update to the contract through an amendment, Salesforce CPQ is smart enough to update this renewal opportunity to reflect those changes.