Pricing

Pricing is arguably the most important set of strategic decisions that a company controls. Pricing too low or too high can lead to missed profit opportunities, lost sales, and market deterioration. Sales teams that control end-customer pricing through discount control can deliver unexpected, misaligned results when they lack the proper incentives and clarity around the value of product sales to the bottom line. Management teams without adequate pricing control and strategy can end up losing strategic control of their business.

  • What prices should we offer to maximize our long-term profitability and success, given our customers’ profiles and competitor actions?
  • How should we differentiate our product offering to capture key pricing opportunities?
  • How should we differentiate our pricing and discounting to different types of customers?
  • What types of discounting controls should we include in our sales management approach?
  • How should we price value-added services and “extras”?

Strategic Management Solutions can help your business to improve its pricing practices through:

  • Identifying weaknesses in your current pricing structure and sales guidelines
  • Developing a pricing plan that properly aligns prices with the market value of your products
  • Developing sales management tools and incentives to support price capture in the marketplace
  • Understanding the value of product features and their impact on market prices
  • Developing models to forecast price trends in commodity markets

Example Projects:

1. Advising a US-based medical equipment manufacturer on strategic and tactical pricing initiatives for its US and European businesses, leading to a projected 1% incremental margin capture across the company’s full revenue base.

2. Advising a leading global auto manufacturer on the development of predictive and strategic pricing models for it’s US remarketing operations, leading to a 20% improvement in price prediction accuracy, a clearer understanding of the market value of their product features, a more strategic approach to pricing, and stronger analytical skills within the organization

3. Developing a statistical price-forecasting model for LCD display panel prices to support forward costing and supply contract structuring for a major US LCD retailer.

 

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