Retail Pricing

In today's retail environment, excessive discounting reigns supreme as the driver of pricing strategies.  However, 'extreme brand' is also emerging as another trend.  The challenge then lies in developing a profitable brand position in a rapidly changing retail landscape


THE DISCOUNT TREND

One major retailer claims to have over 2,000 specials on every week in their supermarket, whilst general merchandise and apparel retailers offer 50% off sales pre season, during and post season.  This level of discounting creates a noisy environment for the retailer looking to use price to support brand strategy, generate value for shareholders and remain competitive in the marketplace. Old pricing methodolgies of cost +100% markup no longer supply retailers with a proven formula for managing retail economics

WORKING WITH PRICING INSIGHT

Pricing Insight can help you price position new products or existing ranges relative to the competitive set in the market place. We can determine the customer's willingness to pay by utilising our sophisticated value in use and value at risk planning framework. This process ensures you optimise the retail value of your offer

By using our 8 Step Strategic Pricing Management Process in our consulting approach, we can engage with your company through the following:
1)  Initial stakeholder interview
2)  Diagnostic evaluation (see Online Diagnostic)
3)  Identification of key pricing issues
4)  Initial report and workshop proposal
5)  Pricing workshop and/or consulting assignment with key recommendations and actions
6)  Publication of an implementation plan
7)  Set-up of a project team
8)  Complete project plan

Our consulting approach is specifically tailored to your company's needs to optimise price and discount systems. We support the preparation, development and execution of:
-  pricing strategy initiatives;
-  pricing policies & tactics;
-  processes to monitor, report and control price realisation

Your company's pricing can improve within 90 days by focusing on the following key areas:

1) Implementation of price control systems
The development of price systems that determine regional, national and international prices. The price systems determine the price architecture of the products and account for differences between core, side and complementary products

2) Development of discount management systems
Price structures are developed using a number of pricing mechanics including:
-  List Price less % discount;
-  Long Term Incentive rebates;
-  Special project/contract pricing and;
-  Exclusive customer pricing and specials management

3) Pricing market management
The concept of price leadership differentiates the market players according to size, strength, behaviour and strategy. Considerations toward 'natural' market areas and 'natural' customers help to define the scope of operations. We coach the price leader in the internal set-up and support the external price communication. This allows the market to understand 'how to price' in a rational and fair market place

4) Optimisation of price lists
We optimise the price list of our clients by developing price architectures that strategically position SKU relativities, product groups and customers.  This will make it easy for your company to do business and support 'value for volume programs' with key customers

5) Executing price rises in the market
We support our clients in the preparation, implementation and monitoring of price increases in the market. The process of price increases involves internal participants (sales, marketing, operations and finance functions) as well as the external business partners


Contact us on +61 2 9091 0226 to evaluate your Margin Expansion potential