All companies have a price modelling tool. However, most of them are based purely on internal costs.
However, the client’s buying decisions are based on the value and price difference between competing offers.
A good tool should mimic the client’s evaluation criteria.
Continue reading Price Modelling Tool
Every sales situation generates a lot of data such as client conversations, win-loss, and price and service level trade off
Similarly, during the service delivery there are multiple pieces of data generated on margins, volume discounts, channel pricing etc. There is an opportunity to create a lot of insights from these data. Continue reading Price Data Analysis
During the RFP stage the parties negotiate very hard on the contracts.
However, if these terms are not enforced , then there is loss of profit. Hence we need an easy way to grasp key profit drivers in a contract.
Very often, the continuous focus on productivity misses the opportunity to leverage the contractual privileges. Continue reading Contract Leakage Analysis
In the area of pricing, there are many tactical steps that give immediate advantage to companies.
However, the CEO’s also need a view on the long term pricing power of their products and services. Unfortunately, the pricing power erodes slowly and in the process leaves very little strategic manoeuvrability when it takes effect. Continue reading Price Intelligence Dashboard
What gets measured gets done.
This adage is very true in sales. If your product’s value proposition and the market communication is not giving you the requisite results, then you must take a critical look at the sales incentives.
We need to evaluate whether the sales process and incentives hinder long term profitability and market positioning of the firm. Continue reading Sales Incentives Design
Given the seasonality of purchases and heterogeneity of the customer’s pricing power, many companies use promotions to attract buyers.
Price promotion should be used carefully. If they are used too frequently, it can have cease to be effective as customers begin to take promoted price as the list price. Continue reading Promotion Management Tool
Inflation is an ongoing phenomena. However, the prices of products can not change every day, unless you are dealing in commodities. The pricing managers usually review prices once in year. As usual there are fears of customers drifting away, if the price increase is too high.
To this complex mix let us add issues like recession and intensity of the competition. Continue reading Price Updater Tool
Many pricing managers do not have the luxury of a fixed price. This is especially true in negotiated deal.
Think of a Request for Proposal (RFP) for an software service or Engineering, Procurement and Construction (EPC). Every such deal is different. A bidder needs to craft an offering and its corresponding price afresh every time.
While pricing is the most important profit driver, what drives pricing excellence is a good team and the process that they support.
A good pricing organisation can be a bedrock in incorporating the buyer preference accurately in the pricing management process. Any pricing manager has to worry about constant requests for discounts from the sales team. She also also to be cognisant to the impact of intra-company pricing issues.
People shop at different market channels. Some buy at neighbourhood stores while others shop at large malls.
Buyer also switch channels based on occasion. Those who shop at large stores for bulk monthly purchases, often depend on neighbourhood store for small filler shopping. B2B buyers also show similar preference. Continue reading Price Channel Alignment
