CPQ RENEWAL & AMENDMENT PROCESS

Summary:

Traditionally it was difficult to track, manage and modify the Subscriptions and Services of the Customer. In the scenario of adding a huge number of Subscriptions or Services for Customers, it was difficult to keep track of what Subscription Products were added or which Product's Price or Quantity is to be modified.

Using Salesforce CPQ, it becomes easy for handling and managing those huge Subscriptions and Services, and Products for Customers. Salesforce CPQ keeps tracking the Subscriptions and Services of all Accounts. So, when a customer calls for a change to their service, CPQ keeps what they already have, so that you can leverage the information to quickly create a renewal or amendment Quote. Salesforce CPQ makes it easy to renew and amend Contracts to handle the most common scenarios.

Let's see how the Renewal Contracts or Contract Amendment Process works by following the steps below. But, before we proceed further with Renewal Contracts creation or Contracts Amendment Process, let's first look at What is Renewal and What is Amendment?

What is Renewal?

Renewing a Contract is simply an extension of an existing Contract for a new term/next term. In Simple words it is the extension of a Contract for the next term Contract depending on Customers requirement.

For Example: Consider one of your customers has a subscription for the Sports Package for 12 months of the term which is ending on 12/31/2022. Customers ask to renew their subscription for the next year. So, at such times you renew customer’s contracts, in which new renewal Opportunity with Start date 1/1/2023 and close date 12/31/2023 is created with same Subscription Product/Package. 

 

What is an Amendment?

A Contract amendment is a change to List Price or Quantity or adding additional Products/Subscriptions, or deletion of Products etc. to an agreement you have already signed. In Simple words it is a revised Contract or a change to an original Contract depending on Customers requirement.

For Example: Consider one of your customers has subscribed to the Sports Package for 12 months of the term in which he has selected 8 channels out of 10. After six months if customers ask us to add the 2 remaining channels to their subscription agreement. So, in this scenario you amend the customers’ Contracts and add 2 channels additionally to the Contract. 

 

How to Renew your Contracts

When your subscription is about to end, renew your Contract. Whenever you renew Contracts, Salesforce CPQ creates a Renewal Opportunity and Renewal Quote. The Renewal Quote contains all the same products when you’re renewing the Contract.

Note: New products can be added to the Renewal Quote.

 

Steps to the Create Renewal Opportunity and Quote:

To renew one of the Contracts you can renew it from the Contract record itself. Just make sure your related Account has a contract-based renewal model.

1. Go to the Contract Record --> Select/check Renewal Forecast checkbox on your Contract record for which you want to create Renewal Opportunities.
   • By checking Renewal Forecast checkbox, Salesforce CPQ creates a Renewal Opportunity on your Account. The Subscriptions are automatically added as Opportunity Products on Quote. The close date is equal to your Contract’s end date.

 

2. Go to the Contract Record --> Select /check Renewal Quoted checkbox on your Contract record.
   • By checking Renewal Quoted checkbox on Contract record, Salesforce CPQ creates a Renewal Quote automatically. The Renewal Quote’s start date is based on the Renewal's Opportunity close date and End date is based on your Contract’s renewal term. All the subscription products and subscribed assets from the Quote you renewed will be available.

To renew two or more Contracts at the same time, make sure your Account has a contract-based renewal model. For renewing one or more Contracts at the same time, also make sure you have one Master Contract.

Steps to the Create Renewal Opportunity and Quote (Renewing Multiple Contracts):

1. Go to the Account --> Contract related list --> Select the checkboxes of the multiple active contracts to renew --> Click Renew Contracts.

1. Choose a Contract to be the master Contract. Your Renewal Opportunity inherits its end date based on the master Contract’s end date.
2. Salesforce CPQ creates the following records.
   • A Renewal Opportunity is created when the close date is populated automatically which is equal to your Selected master Contract’s end date.
   • A Renewal Quote is created when the start date is set to one day after your Renewal Opportunity’s close date. The Renewal Quote is based on the end date of the Contract’s renewal term.
   • The Renewal Quote has a Quote Line with all the renewable products from all the Contracts you renewed.

Example:

Consider you have a Contract with a renewal term of 12. So as per the renewal term, consider your Contract Starts from 01/01/2022 to 12/31/2022 and has below following subscriptions with Start Date and End Date.

Sports Package                            01/01/2018      12/31/2018

Entertainment Package            01/01/2018      12/31/2018

News Package                              05/01/2018      12/31/2018

When you created your Quote, your customer decided that they now want to renew all three subscriptions for a full year of service, so you renewed the Contract by clicking on Renewal Quoted checkbox field on Contract.

 

When you clicked or Checked Renewal Quoted checkbox field on Contract, Salesforce CPQ creates a Renewal Opportunity with a close date of 12/31/2022. Your Renewal Quote has a start date of 01/01/2023. Because your Contract had a renewal term of 12 months, your Renewal Quote has an end date of 12/31/2023.

 

 

How to Amend your Contracts

Amend your Contracts when a customer wants to buy or purchase additional new products or change certain products that were previously/currently are quoted or sold. 

You can either amend from an active Contract or from a contracted Opportunity related to an active Contract. If you’re amending from a contracted Opportunity, make sure that the Contracted field has been selected.

 

Steps to Amend Contract from selected Contract record:

1. Go to the Contract Record --> Click Amend on your Contract.
   • On Hitting Amend button on Contract record, Amend Contracts Page is displayed which shows your active Contract's amendable subscriptions and evergreen subscriptions.

1. Review your subscriptions, and then click Amend. Salesforce CPQ creates the following records.
   • An Opportunity of type amendment where the close date is equal to the Contract’s start date.
   • An amendment Quote is created with start and end dates which is equal to the Contract (Selected contract for amending) start and end dates.

1. Modify the changes as per requirement or as per the Customer's need, add new products, and then save your change.

Steps to Amend Contract from selected Contract record:

1. Go to the Opportunity Record of which you want to amend Contract--> click Amend Contract on your opportunity.

• Amend Contracts Page is displayed, which shows your amendable active Contracts and amendable evergreen Contracts. Choose a Contract, then click Select.

1. Review your subscriptions, and then click Amend. Salesforce CPQ creates the following records.
   • An Opportunity of type amendment where the close date is equal to contract’s start date.
   • An amendment Quote is created with start and end dates which is equal to the Contract (Selected contract for amending) start and end dates.
2. Modify the changes as required or as per the Customer's need, add new products, and then save your change.

Amending Contracts with MDQ Products

This process is useful if you want to update or modify a multiple-year contract term. The process to amend a Contract having multidimensional quoting (MDQ) products is same as described previously.

Guidelines for Amending Contracts with MDQ products.

• MDQ subscriptions having different start dates, cannot be amended, as Salesforce doesn’t Support it.
• You can change any of the segment quantities.
• The product record for an amended MDQ subscription record contains a look-up to the subscription record it was amended from.
• You can change or modify the uplift amount on an MDQ product’s first segment by amending the segment into a different discount schedule or blocking the pricing tier.
• If you add an MDQ product to an amendment Quote, quantity for the first segment is correct, but the quantity shown for each subsequent segment is incorrect.

To know more about the CPQ and its Renewal & Amendment Process, get in touch with us today. Blueflame Labs is one of the leading AppExchange and Salesforce Implementation Partners serving customers with the best possible Salesforce Solutions.