Pricing Project for a Leading European Wholesaler

Client Situation:

Individual sales representatives were responsible for pricing; they were guided by minimum prices. Profits and margins of offers were neither transparent at the time an offer was placed nor after delivery.
A complete new setup of pricing strategy and activity-based costing was expected to deliver a significant bottom-line impact.

Our Approach:

First, quick fixes were identified and implemented through a retrospective Big Data analysis. Afterwards, a market-oriented pricing strategy based on a strategic market analysis and price elasticity tests was implemented. Along with new pricing processes, a centralised pricing responsibility and improved activity-based costing were implemented. Thus, a new pricing strategy was created which allowed the organisation to realise most of its customers’ economic profit.