Understanding the Value of Pricing Improvement
By studying the resources highlighted below, you'll gain a much better understanding of the multi-dimensional value of pricing improvement. While every situation is different, the information provided here will help you assess the potential for your particular company. The decision to embark on a pricing initiative is never easy, but as you'll learn, the gain far outweighs the pain.
Visionary Manufacturers and Distributors Are Gaining Advantage in the Downturn
In the midst of this downturn, visionary manufacturers and distributors aren’t just hunkering-down and waiting it out. They aren’t content to just survive. Rather, they are working proactively to develop advantages that will not only help them weather the storm, but also help them emerge in a stronger competitive position.
Should B2B Companies Be Pulling More Profit Levers in this Downturn?
In many cases, extreme focus on the operational aspects of their businesses can cause B2B companies to lose sight of other powerful profit-levers that are crucial in a downturn. These companies tend to act as though they only have one tool in their tool-belt. And when a downturn hits, their natural reaction is to grab that one tool and just start swinging it even harder and faster.
Industrial Manufacturer of Electrical Products Case
A $3B global manufacturer of electrical products deployed Zilliant Precision Pricing Suite (ZPPS) to supply optimized price targets to sales teams, and margin analysis and enforcement tools to pricing analysts managing a $1B spot transaction revenue stream.The deployment is on track to yield well in excess of $10M of annual incremental profit and produced numerous operational efficiencies across the organization.
High-Tech Distributor of IT Products Case
A leading IT solutions provider deployed Zilliant to better differentiate and optimize prices. Zilliant’s Precision Price Segmentation service identified more than 6,000 discrete pricing segments based on a statistical analysis of sales transaction attributes such as account size, product mix, and rebate level. Using these differentiated prices, sales reps are achieving margins 10 to 20% higher than before, capturing tens of thousands of dollars of incremental margin every day.
Building Products Distributor Success Story
Management at this $3.8B building products distributor sought to institute a structured, data-driven model in which true market-based prices drove margin improvement, with a goal of increasing return-on-sales (ROS) from 6% to 8%. The distributor chose Zilliant as its solution partner because of Zilliant’s comprehensive, science-based pricing software suite, and its proven track record of increasing profits with similar distributors.
Margin-Killing Myth: The Market Controls the Price
This myth alone has done more damage and cratered more markets than all of the other margin-killing myths combined. When executives and managers hold this belief, their margins are virtually guaranteed to suffer. For many executives and managers, this mistaken belief is playing a role in their decisions and preventing them from fully-utilizing the most powerful profit-lever available.