There is a lot of uncertainty in the system right now. Things are improving, but global supply chains are fragile. And it is quite possible that the most recent stimulus bill will create even more e-commerce demand, which will send even more products into this already scrambled supply chain. There are opportunities for any company that can adjust to the present environment, as the author explains.
If your goal is to increase the value of your company, which will have a bigger impact? A 1% increase in price or a 1% increase in growth rate? The answer may surprise you, as the author explains.
Many consumer-packaged-goods companies are stymied because they do not know how (or think it will be too hard) to make the leap toward much greater transparency on the true impact of promotions. The reality is that getting quick results is feasible. CPG companies are learning that the insights derived from advanced analytics capabilities enhance promotion performance—and the bottom line, as the authors explain.
Hermann Simon, Founder and Honorary Chairman of Simon-Kucher & Partners, recently released his autobiography: “Many Worlds, One Life.” The book describes Dr. Simon‘s journey through many worlds, including how pricing became his vocation, how he built the global market leader Simon-Kucher, and how became fascinated by the Hidden Champions.
Companies can generate higher revenue and margins by implementing a more dynamic approach to pricing. The first critical step is for companies to see through the myths around dynamic pricing, which will help provide the ambition and the direction to start their journey.
People often ask us about the worst pricing decisions we have seen. There is a lot of bad pricing out there. But most of it is not so much the result of a bad decision as it is the result of ad-hoc pricing decisions, “me too” pricing or people inadvertently stumbling into a price war, as the author explains.
There has recently been a global surge in the cost of raw materials like metal, granite, and even food. Pandemic-related disruptions, increase in demand, intense supply pressures, trade restrictions, tariffs, increasing labor costs, rising import/export costs, and more are wreaking havoc on pricing in the manufacturing sector. Are there options for pricing or contracting that can protect companies from these sorts of price shocks?
Pricing professionals must be adaptable in general and, more importantly, must be prepared to adjust pricing in response to changing market conditions. And market conditions just keep on changing. And it appears as though the changes are coming more frequently, as the examples in this article demonstrate.
As the economy begins its post-COVID recovery, coupling disrupted supply chains with increasing demand and rising materials costs, managing pricing dynamically and doing so ethically (and with the best interest of supply chains) is important. We cannot forget that short profits might damage long-term reputation and credibility, as the author explains.
Author Lydia Di Liello, pricing expert with more than 25 years of experience, recently interviewed four fellow senior pricing experts to get their perspective on what CPQ (Configure, Price, Quote) is really all about. In this article, she highlights insights from those interviews to educate pricers about what aspects of pricing CPQ does and does not help, and explores the fact that, while CPQ is often supported by software, it is equally a mindset of defining, setting and controlling business processes to achieve repeatable, consistent price for highly configurable products.