Multiple studies have documented that one of the most important ways for companies to improve their profitability, market share and competitiveness is to implement more effective pricing practices.
However, while pricing has been identified as an important tool for senior executives to improve their company's profitability, pricing is not very well managed in many organizations today.
It is vital that everyone who's involved in pricing and selling your products or services understands and supports the pricing strategy the company has in place.
But we found many companies have a pricing strategy that evolved over time resulting in a very unclear and confusing company strategy. Such "evolved" pricing strategies are often undocumented, unrelated and unresponsive to the organization’s current overall business objectives.
In this situation there is usually an opportunity for significant profit improvement. Investing in the development of a clear pricing strategy can be the foundation for greater profitability, increase or defend market shares, and enhance revenues.
It's quite common for us to hear during our pricing assessment project interviews that the present undocumented process is in place because "that's the way we've always done it". It is rare to see an integrated strategy based on sound principles that are tied to today's economic conditions.
These Profit Improvement Opportunity Assessment projects are an excellent way to identify the key leverage points in your business where changes to your pricing practices can give you the best results in the least amount of time. In this process we can quickly identify the best opportunities in your company to improve profits with smarter pricing practices.
The Opportunity Assessment process is designed to identify revenue and profit leakages.
Depending on the size and complexity of your business, Opportunity Assessment projects usually last for two to eight weeks. They include interviewing your key employees and business partners involved in the process using a combination of one-on-one interviews and workshop sessions. There is also a need to perform some analyze of historical data to identify potential profit improvement opportunities.
Current procedures should be reviewed; potential opportunities are then documented; and the gaps between actual pricing practices and your company policy as well as best practices are then identified.
We would be happy to answer any questions or further discuss this or any other area of profit improvement where we might be able to be of assistance. Please feel free to contact us.
Joe Bonocore
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