We help clients significantly increase and sustain profitability by building capabilities for superior pricing and margin management.
In the area of costing the key to unlocking value is cost and profitability transparency that helps you analyze profitability along such dimensions as product, service, and customer. From our experience, this data is in most companies poorly managed or not attributed to the right products, customers, or business units, which may lead to suboptimal decisions. With our costing and data modelling expertise we create real transparency on the profitability of your goods and services and provide powerful visualizations that enable you to make better informed strategic decisions.
While developing transparency on your cost structure and introducing cost accounting might be possible within a few months, establishing pricing capabilities and capturing sustainable value is typically transformative and a multiyear journey.
Due to the so-called Cost-Plus Pricing approach that is very often applied in industrial settings, unfortunately the terms costing and pricing are used interchangeable although they mean something totally different. While price reflects the amount a customer is willing to pay, cost is the expense incurred for creating a product or service a company sells.
What we do
Based on your strategic priorities we develop a costing roadmap to answer your most burning questions. We dig into your data assets and together develop cost rates and cost allocation models which are integrated into transactional data bases fitting your needs. Using this information, we provide profitability analytics to drive strategic analysis and decision making, show the true cost/profitability at a product category or item level, and enable you to learn more about the true cost-to-serve and profitability of your individual customers.
Pricing is the most powerful and most direct driver for growth and when managed well can be a distinctive source for competitive advantage. It is strategic and requires building the right set of capabilities. Optimal pricing is not about charging based on cost but rather based on the willingness of the customer to pay. Perceived value can vastly exceed the cost of production, which is why it is crucial to set a price which captures as much of the difference as possible. Understanding the internal factors which influence price, as well as your customer’s value perception and willingness to pay are the basis for creating a customer-centric pricing culture which systematically maximizes price-driven profits.
What we do
Together with you we develop effective pricing strategies connected to your business goals and help discover the real value of your products and services in each specific target segment. We support you in creating a pricing infrastructure – from developing basic calculation logics, tools and pricing technology until training and coaching of front-line employees – that allows delivering prices to the marketplace and enables uncovering price leakages on transaction level. Once an infrastructure, the right organizational set up and proper static pricing approaches are in place, we take it a step further and move towards AI-powered real-time pricing that provides pricing decisions at scale on a highly granular level. We use data science and machine learning in customized list price setting, discount & promotion optimization and hyper-segmentation to identify willingness to pay in real-time. We deliver the right tools, knowledge, and trainings to develop processes and people in such a way that continuously identifying opportunities for margin improvement becomes part of your culture.
While each project is individual our tech-supported approach is highly standardized and proven multiple times.
Based on your problem statement and a preliminary analysis of your pricing structure and organization we determine possible approaches, identify quick-wins, and collaboratively design a customized project setup. Outcomes of this phase are agreed objectives and a clear project proposal.
During the Price Performance Diagnostics we conduct a maturity assessment and visualize your pricing with custom tools. We identify improvement opportunities and develop hard facts that build the basis for our recommendations.
The recommendations of the Price Performance Diagnostics are used to develop one or more designs, with which the targeted project result can be achieved. During execution planning a roadmap for the implementation phase will be laid out, and your pricing talent will be assessed.
Depending on the scope of the pricing project the implementation phase can span a few months or take up to 2 years. During this phase we train and develop your pricing talent and together with you build next level custom pricing tools. In the implementation phase we secure that the designed change or initiative is implemented and guide, support, and coach your organization for sustainable success.
We believe that transformative change and exceptional growth requires constant monitoring and retesting. During a so-called Re-Check we redo defined elements of the Price Performance Diagnostics to measure the implemented results against the expectations from Phase 1.
Phase 1 to 4 are supported by sophisticated
project management tools and reporting tools.
Phone +43 664 1575665
Hours Mo – Fr 10am – 8pm