The Real Cost Behind Traditional CRM Software

In today’s fast-paced environment, distribution sales teams face the challenge of keeping up with changing customer expectations while setting accurate sales forecasts and meeting targets. 

Traditional CRM software has evolved to meet these demands and giving your team insight into the best opportunities for growth. 

With comprehensive data on each account and contact at their fingertips, your sales team can be more responsive and quickly identify trends that impact revenue. They can maximize customer retention and promote upsells and new deals. 

When CRM software works well, it has a significant impact, improving productivity by nearly 35% and increasing customer retention by as much as 27%, according to Forrester Research. Yet the same research shows almost half of CRM projects fail. Those that finally make it to implementation often have low user adoption or don’t see the returns a company expected. 

We’ll take a closer look at what traditional solutions offer, the real cost of CRM software, and how to find the best solution for your company. 

What Do Traditional CRM Solutions Offer?

Traditional CRM software solutions offer a consolidated platform for capturing customer interactions, tracking sales pipelines, and managing marketing campaigns. At minimum, most solutions offer at least the core features sales teams need to have visibility into customer contacts and interactions, including: 

Contact management

Rather than storing customer names, email addresses, phone numbers and other relevant details on individual Excel spreadsheets, contact management makes all this data visible across your organization. That way if a sales rep leaves, your valuable customer data doesn’t leave with them. 

Lead management

While managing existing customer relationships is crucial, most CRM software also allows your team to interact with prospects through email, phone calls and other touchpoints. The best CRM software automatically records these interactions so your team isn’t spending half their day logging their activities. 

Task management 

The ability to schedule meetings, send follow-up emails, and assign team members specific tasks when they need to follow up with a customer or lead is another essential feature of a CRM.

Document storage

Your CRM should help your team stay organized by maintaining records relevant to sales, including quotes and all correspondence related to customers and prospects.

Workflow automation

It’s becoming increasingly common for CRM software to include automated workflows that reduce the need for so many manual tasks. One example is the ability to create a workflow that notifies all relevant team members to take appropriate actions when a new deal is signed. 

Sales management

Many CRM solutions include features to improve sales efficiency, including allowing sales reps to create quotes or orders and track their status. 

Sales performance tracking

A CRM solution should give you full visibility into your sales team’s performance, showing the number of meetings, active deals, and closed deals for each rep. It should also give you an overview of how your sales pipeline and actual sales numbers compare to your sales targets for the month, quarter, or year. 

The Evolution of CRM Software 

As the digital landscape has evolved, CRM software has become more comprehensive and critical to business operations. 

The CRM software market continues to expand at a compound annual growth rate of nearly 16%, expected to reach $37.8 billion through 2026, according to Gartner. 

The best solutions combine advanced features with an intuitive user experience, making it easy for even tech-averse sales reps to embrace them with little or no training. 

While many ERP systems have features or add-on solutions designed for sales, marketing and customer support, their functionality is sometimes limited, and their user experience is often lacking. 

They may be difficult to access remotely, leading to a frustrating experience for your sales reps. They don’t necessarily connect to other elements of your revenue generation engine, including marketing and customer support, which can create a disconnect for your team and your customers. 

On the other side of the spectrum is software designed to support sales and marketing teams across a wide range of industries. These solutions have evolved over the past two decades, with a focus on improving sales performance and team productivity. While their broad focus works well for many companies, it’s not ideal for the distribution business model. 

Why Distributors Need CRM Solutions Built for Them

Distributors need to negotiate with vendors and customers and maintain close relationships with both while keeping a close eye on inventory, order fulfillment, and other logistical challenges. Traditional CRM software solutions typically don’t integrate with ERP systems. While they may offer reporting, they don’t deliver true business intelligence in a way that makes it easy for sales reps to see what accounts to target or what actions they should take next.

For instance, they won’t tell you if an existing “bill to” account has $80,000 in late orders for dozens of different “ship to” locations before you call them. You can’t easily see the full order history across locations. You can’t see a clear overview of accounts with a decrease in purchases or no recent activity in the last few months. And you can’t see if this account has stayed up to date on its payments or if other members of your customer service team have engaged with them recently. 

Because most CRMs don’t map all these fields from your ERP system, your sales team is contacting customers and prospects without the full context of the interactions they’ve had. 

When distributors implement CRM software that wasn’t built for them, it’s not uncommon for them to spend the first six months or more trying to customize it for their needs. 

For Callico Distributors, a third-generation wholesale distribution company, investing in a three-year contract with Salesforce led to buyer’s remorse. The system was too complex and difficult for the team to use,

“It was exceptionally expensive, and we probably used 4% of the functionality,” Vice President of Strategic Initiatives Cole Callahan said. 

Worse, Salesforce didn’t integrate with their ERP. To address this, the company would have needed to invest another $60,000 for a custom-developed integration between the two platforms.

CRM Costs Comparison: Understanding the Real Investment

To avoid buyer’s remorse, it’s essential to estimate the total cost of ownership for CRM software, not just the subscription price. Here are some of the unexpected costs you may encounter with traditional CRM software: 

1. Licensing costs

Most CRM platforms have tiered licensing models. They may have a free or low-cost version that includes limited features, with the option to upgrade later. These plans most often include a  limited number of users as well. Those limitations may mean you can only add territory managers and outside sales reps, but not your entire team of inside sales reps — and certainly not all customer-facing employees. 

Since these employees — including accounting, customer service, operations, and marketing — play an important role in managing customer relationships, they should have access to your CRM.

2. Implementation time and costs

There’s an entire industry of CRM consultants for a reason — traditional CRM software often comes with a steep learning curve. Setting up the system to match your business processes may require consultants or specialists who set their own timeframes and charge substantial fees. Large, complex CRM systems typically require a CRM administrator or consultant just to set them up. Others require an IT consultant who may charge for each individual customization you may need to build. ‌

Whether you’re customizing your CRM, integrating it with your ERP and maintaining that integration, or training your team to use it effectively, these costs all impact the bottom line.

3. Data storage costs

With traditional CRM solutions, the costs associated with data storage can add up quickly. As your customer base grows and you store more information, you could find yourself paying more than you anticipated just to maintain your existing data. This can become particularly challenging for businesses that deal with vast amounts of customer data or those in the growth phase.

4. Maintenance and upgrade costs

As many as 85 percent of enterprises are expected to take a “cloud first” approach to software by 2026, according to Gartner, and many mid-sized organizations are following them by moving away from server-based solutions. This eliminates many IT-related costs of traditional on-premise CRM solutions, including infrastructure and maintenance costs. 

Investing in software-as-a-service solutions should also mean your company always has access to the latest version without paying for upgrades, but this isn’t always the case.

4. Support costs

Speaking of support, not all CRM solutions include it in the subscription price. It’s important to ask what level of support is covered to avoid this commonly overlooked cost of CRM software.

6. The costs of additional solutions 

Not all CRM software includes business intelligence, marketing automation or customer support solutions. This means you may need to invest in other solutions like MailChimp, Constant Contact, Zendesk or Microsoft Power BI and price out these solutions separately. If you find a CRM solution that includes these functions, your company may realize immediate savings from no longer needing additional subscriptions. 

Achieve a Faster ROI with White Cup CRM

While other CRM solutions force you to make compromises like sacrificing functionality, forgoing an intuitive user experience, or paying high costs to consultants to get exactly what you need,  White Cup CRM is designed to reduce your total cost of ownership while putting you on the path to faster return. 

With decades in the distribution industry, we’ve built a CRM and business intelligence solution that integrates directly with your ERP and includes all the visibility and functionality we know you need.

That includes: 

• Customer scorecards that make it easy to see a complete customer history at a glance
• The ability to see top accounts, top products, purchasing history and more
• All the sales and marketing automation capabilities you’d expect from leading CRM solutions like Salesforce or HubSpot, without the need to customize them for distribution
• A quoting solution integrated with your ERP system, so your team can search for products to add to it, see available inventory, and close deals faster with electronic signatures
• Prebuilt dashboards and templates for emails and workflows 
• Integration with your eCommerce solution

This makes it easy to start seeing value on day one of using your CRM. See what’s included.

We believe a CRM should be for everyone because everyone plays a role in serving your customers, whether it’s the sales team closing a deal, a marketing leader running a campaign, or a customer support team member following up on a late shipment. That’s why we don’t charge for additional seats — your company can add as many users as you want with our infinite licensing model.

We believe CRM software costs should be straightforward, so we don’t charge separately for maintenance, upgrades, or support. 

With White Cup CRM, outside sales reps can see everything they need to know about a customer before they visit and enter notes quickly using speech-to-text, allowing them to spend more time selling and less time documenting activity. 

Sales leaders can see the most important metrics at a glance, including sales forecasts, year-over-year sales, and sales totals for each rep compared to their goal. 

They can easily see purchasing trends, top products, and more to help them set priorities for their team without having to request reports from IT or hire a data analyst to compile them.

See why more than 850 companies trust White Cup as the best CRM for distributors. Schedule a free consultation today.