Tacton: Solving Manufacturers’ Most Complex Product Configuration Problems In A $2+ Billion Market

By Amit Chowdhry ● Mar 27, 2024

Tacton is a leading SaaS company trusted by global manufacturers. Pulse 2.0 interviewed Tacton chief customer officer Nils Olsson to learn more about the company.

Nils Olsson’s Background

Nils Olsson

What is Olsson’s background? Olsson said:

“Tacton’s software solutions help manufacturers drive sustainable, profitable growth and set high standards for sales productivity and industrial excellence. Prior to Tacton, I worked at Tetra Pak for several years, where I eventually served as the Manager of Portfolio Management, overseeing business development, marketing, and product management models. I successfully implemented a new go-to-market model in over 165 countries, introduced a data-driven customer value-based product management model, and implemented a global digital transformation of the sales process with CPQ. Before Tetra Pak, I was the Head of Product Support at Sidel for four years.”

Formation Of Tacton

How did the idea for the company come together? Olsson shared:

“Tacton got its start in the late 90s when six computer scientists applied cutting-edge technology to solve manufacturers’ most complex product configuration problems. We played a pivotal role in the creation of Configure Price Quote (CPQ) for manufacturing, and, as leaders in the industry today, we are committed to helping manufacturers lead the way toward a more sustainable future.”

Core Products

What are the company’s core products and features? Olsson explained:

“Our flagship solution is the cloud-based Tacton CPQ, designed to simplify selling complex capital equipment for manufacturers. With the power of our Trusted Configurator, anyone can configure, price, and create an error-free quote with ease, resulting in a fast and flawless buying experience.”

Olsson elaborated by saying, 

“Global manufacturers trust us to solve their most complex challenges so that they can focus on delivering a better buying experience for their customers. For that, we have developed Tacton CPQ, the leading Configure Price Quote solution made with complex manufacturing products in mind. Our global teams are dedicated to helping manufacturers achieve new levels of success in a rapidly changing world. Tacton CPQ also connects business and manufacturing processes, enabling manufacturers to be more agile as they respond to customer needs and adapt to market changes.”

Favorite Memory

What has been your favorite memory working for the company so far? Olsson reflected:

“Two come to mind. First, when we launched Tacton CPQ several years ago, I remember that the response from the industry was tremendous. CPQ had been available for a while in other sectors, but the solutions targeted simple product sales. We created a CPQ offering specifically built to sell incredibly complex manufactured products, which is a totally different ball game. When we brought Tacton CPQ to manufacturers, we gave them the revolutionary ability to open up access for their customers so they could easily explore entire manufactured goods portfolios – then seamlessly engineer the chosen products and deliver them in time and at forecasted cost.”

“Second, last year was a huge milestone for us when Gartner gave us the highest placement of all CPQ vendors in the firm’s coveted Magic Quadrant report. That was amazing recognition, and in my opinion it validated much of the hard work our team has put in to make Tacton CPQ the best it can be. In between these memories have been so many countless other customer successes that we’re very proud of – and our customer success is what drives us forward.”

Challenges Faced

What bottlenecks has Olsson faced in building the company? Olsson acknowledged:

“When we first came to the market, we were ahead of our time, so we had to overcome misperception bottlenecks. As the first manufacturing-specific CPQ that was delivered in a software-as-a-service model, there were not a lot of people convinced right out of the gate. Many of our potential customers were leaders at 100-year-old, traditional companies, and moving from on-prem to SaaS seemed daunting to them. But that leap to SaaS was absolutely the right thing to do. We’ve since seen the manufacturing sector completely move toward SaaS, and now the majority are bought in.”

And have you had to overcome more recent challenges? 

“More recently, during the slowdown triggered by the COVID pandemic, we were concerned that our business may get caught in the same eddy many companies were caught in, as sales across entire industries slowed down amidst uncertainty. However, the opposite was true. Manufacturing company employees were suddenly working from home, so the digitalization capabilities we offer were perfectly suited to help those people thrive as they switched to selling manufactured goods from their computers rather than relying on in-person interactions. Our customers thrived, so Tacton also thrived and came out ahead. Post-pandemic, we’ve seen the world go into a bit of a recession. Inflation has gone up. Initially, there was a bit of a bottleneck, I supposed as the length of sales cycles increased during times of economic uncertainty. But as manufacturers needed to become more efficient, we saw a similar phenomenon to what we saw during the COVID slowdown: more manufacturing customers turned to Tacton solutions to help them become more efficient to grow during potentially concerning economic times. We’re fortunate that our technology helps so many firms during their slowdowns, because it means that even during potential slowdowns, demand for Tacton actually sees a bump.”

Evolution Of Tacton’s Technology

How has the company’s technology evolved since launching? Olsson noted:

“Tacton has evolved its technology in response to our customers’ changing needs, focusing on simplifying complex CPQ workflows and improving business outcomes like profitability and efficiency. We have also integrated sustainability and subscription-based models into our offerings. Continuing to offer new integrations and features helps manufacturers configure, price, and quote complex solutions with confidence and ease and deliver better customer experiences. In 2022, we launched Tacton CPQ Data Import Automation, Tacton Product Validations, an enhanced version of Tacton’s Integration to Salesforce, and released an update to Tacton CPQ Visualization.”

“More recently, in September, we introduced two new features designed to redefine industry standards: System Configuration and Layout Planning. Tacton’s System Configuration enables manufacturers of large, complex solutions such as HVAC systems, production lines, plant layouts, electrical infrastructure, windmill and solar panel parks, and more, to overcome complex configuration challenges. Tacton’s Layout Planning allows sales representatives to create a visual layout of equipment and systems while adjusting configurations without additional CAD software or engineering involvement. Users of Layout Planning are expected to significantly speed up the quotation process by reducing manual handovers and providing visual layout feedback to customers, leading to higher win rates.”

Significant Milestones

What have been some of the company’s most significant milestones? Olsson cited:

“Tacton has expanded from a Swedish startup to a global CPQ SaaS vendor, with major customers like Siemens, Xylem, and ABB. On average, our customers see a 34% increase in efficiency, a 30% increase in sales volume, and a 20% boost in profit margins. We recently celebrated our 25th anniversary of leading the manufacturing industry, bringing innovations in sustainability, advanced product configuration, and smart, subscription-based services to change the way manufacturers do business. In July 2023, we announced our latest innovation focusing on sustainable product sales: Environmental Footprint Configuration. This groundbreaking addition to Tacton CPQ is set to revolutionize the manufacturing industry by empowering businesses and their customers to make informed decisions that align with their sustainability goals.”

Customer Success Stories

Can you share some customer success stories? Olsson highlighted:

“Topsoe is a global leader in chemical processing technology. Today, Topsoe delivers a wide range of catalysts and process technology that is essential for producing clean fuels from crude oil and waste, removing harmful emissions from power plants, and raising the efficiency of industrial processes.

Topsoe has been using Tacton since 2016 and Tacton CPQ since 2021. With Tacton CPQ’s integration to Salesforce and to other internal systems, Topsoe has achieved:

— Speed and accuracy in sales and quoting, creating customer trust

— Consistency in quote content and branding across all markets and across quote revisions

— Ease of use for sales staff

— Decreased IT maintenance costs with Tacton CPQ SaaS

— The CPQ has become the single source of truth for product and pricing data, breaking silos in the organization.”

Funding/Revenue

After asking Olsson about the company’s funding and revenue information, he revealed:

“We can’t share numbers but I think that our success and reputation in the market is reflected in the fact that we recently secured a strategic investment from Rubicon Technology Partners, a leading private equity firm that is focused exclusively on investing in and growing enterprise software companies. Additionally, our investment partner since 2017, GRO Capital, is a co-investor and joined Rubicon in supporting the next phase of Tacton’s growth.”

“Through the process of speaking with Rubicon and receiving that investment, it was obvious that we are extremely well viewed in the market. We saw a lot of interest in Tacton from a wide range of companies and we were able to choose the best investor to take Tacton to the next level. Our growth has been very strong, particularly in North America. We are clearly the dominant player in this space and Rubicon is committed to continuing that trajectory and solidifying that position.”

Total Addressable Market

What total addressable market (TAM) size is the company pursuing? Olsson assessed:

“For all types of CPQ – the market is north of $2 billion as of 2024. Within that, the manufacturing space is about $1 billion, and that number is growing. CPQ solutions is growing about 15% per year.. There is a generational shift in the manufacturing sector as more of the upcoming leaders are a) very comfortable adopting SaaS technologies to push their companies into the digital age, and b) many of the older on-prem tools that were used in the past are becoming obsolete, and are therefore no longer supported. The convergence of these trends puts CPQ squarely in the sights of manufacturers.”

Differentiation From The Competition

What differentiates the company from its competition? Olsson affirmed:

“Unlike our competitors, who are just starting to anticipate what’s next, Tacton is already prepared for growing market trends like sustainability and the move to subscription models. Built specifically for the manufacturing industry, we offer far more than what a generalist vendor would be able to provide, and it’s this forward-looking approach that brings our manufacturing customers into the future.”

Future Company Goals

What are some of the company’s future company goals? Olsson pointed out:

“At Tacton, our mission has always been to deliver technology and service solutions that anticipate tomorrow’s trends. As we go forward, we will continue to enhance our innovative CPQ solutions with two goals in mind: enabling smooth and resilient end-to-end operations; and delivering a flawless digital customer experience when selling complex equipment and related services.”

Additional Thoughts

Any other topics to discuss? Olsson concluded:

“I want to underscore the point that CPQ is not just about creating quotes more efficiently. That narrow focus is a common misconception. There are so many people involved in the sales process for complex manufactured goods – and CPQ is the common thread across all of their functions. From initial customer interactions, to seamless engineering, to understanding  every link across the supply chain – all of these steps are touched and improved upon by CPQ.” 

“It’s a tool that bridges systems of record, and serves as the great integrator across systems. CPQ connects with ERP for tracking orders and invoicing, with supply chain management systems for parts/production, with PLM and CAD for making iterative changes to products along the way. CPQ has become one source of truth for product knowledge, creation, sales and service.”

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