Pricing and Profitability Management

If your organization is like most, pricing is a set of disparate activities carried out in different sections of the business – Finance, Marketing, Sales and Operations. And each function works with a different set of data to make pricing decisions. Different functions also often define goals and reward performance using different metrics, which can be in conflict with each other.

If you are asking yourself the following questions, it's very likely that a Price Optimization can help you improve business results:

Price Optimization refers to the process of defining precisely where, how and at what price to compete. The objective of price optimization is to achieve the highest sustainable prices  for the entire portfolio of products across all market segments and channels.

Pricing Challenges:
Strategic Pricing – More and more managements are moving from actual cost based prices to strategic pricing – pricing based on their customer’s perception of value. Pricing has, therefore, become a strategic challenge. 
Dynamic Business Environment – Businesses change, markets change and even the product undergoes changes. It is critical to ensure that your pricing program is flexible enough to meet unexpected shifts in priorities and underlying business realities.
Increasing Competition  – Prices must respond to competitive moves, product life cycles, economic conditions, and customer's changing perceptions and preferences.  

Sustainable pricing requires:
• Rapid and accurate flow of information.
• Rigorous discipline to eliminate brokerage.
• Introduction to additional costing techniques

The Bottom-line Difference
• Understand your profit drivers 
• Maximize profitability 
• Sustain profitability 

At iMaster optimized pricing process implementation starts with a rigorous evaluation of contribution margin by product, customer, channel, and territory. From this evaluation, decisions can be made to rationalize products, manage customers differently, renegotiate channel relationships, or redeploy salespeople and marketing resources by territory. We work with you to set new prices by simulating different scenarios and connecting the results to your current business strategy and market.

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