At Value and Pricing Partners, our team has extensive experience working with large organizations to solve complex business problems.  Among others we have experience with GE, DuPont, PPG, Ericsson, First Data Corporation, Shell and the Federal Reserve.  Following are several cases describing our experience.

Improving Global Sales Performance
A $400M division of a global specialty chemical firm needed to increase prices due to increasing raw materials costs.  The objective of senior management was to facilitate increased price capture by improving the value selling capabilities of their global sales force.  The solution involved working with the country and regional leaders to identify key opportunities, providing executive leadership with a prioritized road map for improvement, and implementing a sales training program including tools for segmenting buyers by willingness to pay, quantifying price sensitivity, prioritizing key buying factors and quantifying value.  Finally sales compensation was upgraded from revenue only incentives, to revenue plus price target incentives.  Resultant price capture increased beyond expectations.

Pricing Challenges in Global Markets
Country managers were responsible for pricing decisions at a Fortune 50 manufacturer of capital goods.    Price concessions and “deal sweeteners” (extra services, spare parts, etc.) were typically used to close sales.  Consequently profits were declining as customers ignored value while demanding lower prices.  Price competition was increasing as competitors responded by cutting their price points.  The management team was discouraged because they believed it was impossible to control their market activities and pricing.  The solution lay in first understanding the nature of the firm’s market, which was truly globalized with both global customers and global competitors.  This market needed more global management, with country management responsible for implementing an integrated, global pricing strategy.  Based on the unique differentiation of the firm, the foundation of this strategy involved restructuring the offering to force customers to choose between discrete options with price-value tradeoffs.  Customers could have lower prices if they chose lower value options.  Sales processes were developed to better communicate value delivery and negotiate on value rather than price.  This shift stopped the price erosion; realized price levels moved up 12% and profits increased 15%.

Price Performance Management
Executive management at a middle market software company (Under $1B), with deal sizes ranging from $1M to $50M, had no process in place for routinely managing pricing performance.  As a result discounting ran as high as 40% on both products and services, totaling millions in lost revenues (and margins) annually. The solution involved mapping historical prices to demonstrate current behavior, building a database to permit routine analyses of ongoing behavior, establishing pricing policies and pricing review processes to enforce them, and reporting performance monthly to the Executive Committee.  Results included a significant reduction in discounting, early warnings of problematic trends and identification of opportunities to raise prices.

Managing Pricing Across Borders
 A large chemical firm operating in many countries had a mix of global, regional and national customers.  The firm provided a broad array of offerings to these customers, but suffered from weak value definition.  The sales team used price negotiations to close deals, and frequently gave away services to get customers to buy.  Frequent corporate demands for growth (defined as volume increases) and profits were seen as contradictory by national managers, and there was considerable frustration among country managers on pricing policies. The solution lay in building a pricing strategy and structure responsive to the needs of individual markets.  Because of the mix of customers, pricing strategy required a balance between more integrated and more local approaches.  A global offering-price structure was developed for global customers, while a national offering-price structure was developed for local customers.  Strict policies were established for developing and changing price points, and significant skill development efforts were undertaken to improve marketing and sales pricing proficiency.  This effort resulted in a 17% profit improvement.


To schedule a phone appointment to discuss your pricing challenges, contact tim@valueandpricing.com