Pricing:

Industrial company transforms its pricing and improves margins 300 bps

The Situation

This manufacturer was a global $3B industrial company with multiple product categories. It sold through a distribution network to thousands of end customers. The company had a complex pricing structure, and no pricing strategy.

Moreover, the pricing process was extremely slow. 80%+ of quotes went through review process, taking up to 2 weeks to produce even simple quotes.

The result? Frustrated sales reps, a poor customer experience, and irrational market pricing.

The Solution

Team did a thorough modernization of the company’s price capabilities:

• Assessed current state, using 2 years of transaction data
• Analytically segmented customers by their willingness to pay
• Developed a new pricing framework and recommended pricing ranges by segment
• Created new pricing governance policies & processes
• Incorporated price recommendations into the company’s CPQ system
• Rolled out to the organization

The Impact

The transformation was a great success. In multiple regions, the company achieved impressive results:

happier sales reps and customers. In addition, the company had greater control over their pricing and had the capabilities in place to make changes to future market conditions.

• 310 bps improvements in margins
• a 70% reduction in low-priced deals
• quotes that changed from days to minutes
• happier sales reps and customers

In addition, the company had greater control over their pricing and had the capabilities in place to make changes to future market conditions.