Author: MarginHound

Getting Run Over By a “Paid For” Truck

On By In Customer Profitability, Distributor Pricing, Pricing Analytics

As a cautionary tale, we present to you a Vegas story in which a janitorial supplies distributor’s best price was crushed by a food service competitor who had already covered their cost to serve.

In your own business, where are you at risk? What kinds of competitive barriers can you throw up (product or service) to defend your market position? Playing offense, can you use this approach to take share within an account?

Because there’s no guarantee that what happens in Vegas, stays in Vegas

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Strategic Pricing: 9 Ways To Improve Profit Margin

On By In Customer Profitability, Distributor Pricing, Margin Improvement, Pricing Analytics, Pricing Consulting, Private Equity, Product Profitability, Project Profitability, Turnaround Strategy

True Strategic Pricing isn’t about simply charging more money In fact, that’s a very risky long term value creation lever. The market eventually figures out what you’re doing.

Pricing leaders know that you need to be as good at creating value as your are at claiming it.

For a sustainable margin lift, look at these case studies exploring how to reshape the value you offer customers – and cost of delivering that value – to create a competitive advantage.

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Using Customer Profitability For Good vs. Evil

On By In Customer Profitability, Leading Change, Margin Improvement, Private Equity

The worst thing you can do with your new customer profitability reporting is sally forth to fire the unprofitable customers

Instead, look at this as an opportunity to reshape the focus of your selling team. Which accounts do we want? Can we fix our profitability issues by growing within an account? Are there product mix or policy enforcement opportunities which can improve the profitability of the business we already enjoy?

Or are we selling services the customer doesn’t really need (or want)? Giving us a chance to simplify our offering before we’re removed by a low-cost competitor.

Sometimes the best way to improve customer profitability is to simply focus on value…

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