CalcuQuote is an end-to-end RFQ Management System designed specifically for the Electronics Manufacturing Services (EMS) industry. Its founder is a young entrepreneur, whose family owned an EMS. He took on one of the main pain points of the industry – quoting – and offers a solution to reduce the time it takes from days to minutes. EMSNOW asked him about his solution and why the industry should consider an alternative to home grown spreadsheets.
EMSNOW: Chintan, you literally grew up in an EMS company. How did that experience influence your decision to start CalcuQuote?
When I was 11, my first job was putting through-hole parts on a board for a dollar an hour working for my dad. I remember being really jealous that my sister got paid twice as much just because she was older. But that was the start of my exposure to EMS. Seeing my dad and his partners talk with such passion about work (even when they weren’t at the office) was the start of my exposure to entrepreneurship. It was through seeing them that I decided I also wanted to start my own business one day.
I was exposed to the quoting process when I was in high school, and I realized that everything about it was tedious and error prone. Quoting was my most dreaded job and there had to be a better way! I started to obsess over it. We implemented all kinds of Excel models and macros, but I couldn’t deal with the incremental improvements on such a bad process. And that’s when the idea of building a complete software package around quoting was born.
I knew it was a problem worth solving because I had personally experienced the pains. The 20 years of EMS exposure and iterating through Excel models provided a great foundation for how to build CalcuQuote and the people who would be our customers. And the customer centered nature of EMS business is what we infused into CalcuQuote’s support model.
What are the biggest challenges EMS companies face in pulling together a customer quote?
Speed is the biggest challenge. We hear from EMS companies (especially from the sales teams) that their customers just aren’t willing to wait for a few weeks to get their quotes back. In fact, they’re barely willing to wait for a few weeks to get their assemblies built.
There’s also a challenge with efficiency in quoting. If it takes you hours of manual work to prepare a quote for a small run, then even if you win the job, you’ve already lost all of your margins. For low volume quotes, EMS companies need an efficient method of compiling a costed BOM and accurately estimating labor costs.
Finally, as quote volume increases, the coordination costs get worse. Sales teams get frustrated by having to wait for one department or another before a complete quote can be ready. EMS companies need a central place where they can input, process and track quotes to make sure they are completed ontime, efficiently and without error.
What % of the EMS industry uses a quoting tool such as CalcuQuote versus doing it themselves internally?
I don’t have exact figures on this, but if our 100+ customers are a good sample then I’d say less than 30% use a software. Most people use Microsoft Office to get their quotes done.
What is the greatest inhibitor?
The greatest inhibitor is a lack of awareness. Most people we talk to haven’t even considered that there could be an alternative to manually processing quotes through spreadsheets. This is part of why I love doing CalcuQuote demos. Seeing the reactions from quote teams when they realize how fine tuned CalcuQuote is for EMS is priceless.
What information do you need to compile a quote and what is preferred format to receive it?
For anyone requesting a quote from a contract manufacturer, the minimum for an accurate quote is a BOM in MS Excel, gerber files for the PCB and assembly drawing. We see across the board that the BOM is usually the biggest pain point in all of this. Even when a BOM is in Excel, the layout can be unintuitive and key data points could be missing, ambiguous or inaccurate. My recommendation to EMS customers is to make the Excel file as close to a flat table format as possible. Knowing that BOMs will never come in the perfect format, I highly recommend training your quote team on advanced Excel technique because that can save you hours of manual tasks on each BOM. CalcuQuote puts out a lot of content in this area as well – just check out our webinars and blogs.
What is the average time it takes to complete a quote with and without a tool like CalcuQuote?
The average depends on several variables – size of the BOM, how many sources you want to go to, the quantity being quoted, how many exceptions there are on the BOM, etc. A benchmark that we use internally is that if it takes more than 15 minutes to upload a BOM and do a first pass pricing, then we try to investigate what made it take so long.
What form does the output come in, and what ability does an EMS have to customize the tool output?
There are many output options from CalcuQuote. Because the industry still lives in the mindset of Excel, everything from the costed BOM and labor model to the finished quote can be exported to Excel. But most of our customers use the professional looking PDF outputs to create polished, customer facing documents. The published quote report can be customized with company logo, tag lines, brand colors, terms and conditions and more.
How have your tools and services changed since the company was founded?
CalcuQuote’s product team consists of 25 people and growing! Since 2015, we put out an update every four weeks (or less). We continue to add features and functionality regularly based on direct feedback from our customers. It is one of the things we hear our customers say they love the most: their ideas turn into reality with CalcuQuote.
In addition to the core quoting application, we’ve been working on building a software ecosystem around the needs of EMS. ShopCQ, a purchasing tool for EMS, is scheduled to come out of beta this year. The idea behind ShopCQ is that our customers can go from receiving a customer purchase order to having all of the parts placed on order to their suppliers with a few clicks of the mouse.
Is there anything else you would like to tell our readers about CalcuQuote?
When CalcuQuote was in its first year, we were discussing how to handle support for our new customers. We looked at what typical software companies do and realized we were never happy after a customer service call. That’s when we decided that our customer service experience would be on a completely different standard. We would focus on making each interaction with the customer informative, personalized AND fun. We’d get to know our customers, their priorities and where they can use the most help. We wanted to become the concierge you call when you need a hand, rather than the toll-free support line you call when you’re frustrated.
We knew that scaling with this model would be harder but we were willing to make it a priority. I’m really proud to say that even today, with hundreds of users logging into CalcuQuote, our median response time to a customer chat is around 1 minute. Sometimes customers are talking with us to ask a simple question, some share ideas, and other times they’re just having fun.
Either way, our customers are what make this so much fun and I wouldn’t trade that for anything.