Question: I would like to know where to start a competitive and realistic Price Policy, when you have hundreds of Price Lists, many channels and categories, but a lack of connections between actual prices.
Answer: Hi M, How do you eat an elephant? One bite at a time. I’d start by creating an overarching strategy and approach to pricing. Then, move one channel/segment/region/product line over at a time. Find the low hanging fruit. Find one market segment and product line where there is a higher willingness to pay than what we are charging. Adjust those prices. Monitor and report the change in revenue and profit to prove that you capture more value. Assuming profit went up, this increases your ability to influence others.
Tweak and perfect the process. With demonstrated success, more people inside your company will want to move quicker. The trick is knowing what to do first.
Unless you are the CEO, you don’t get to tell the company to change.
It’s very possible that I misunderstood the specifics of your question, but the answer would probably still be the same. Start small, demonstrate the increase in profit, and gain influence to expand your efforts.
One BIG problem with pricing is everyone seems to have their fingers in that pie. Unless you’re the CEO, the only way to change pricing policy is through influence. Influence comes from demonstrating expertise and results.
Also Read: Q&A: Pricing Product with Service
**Note: Mark Stiving has an active LinkedIn community, where he participates in conversations and answers questions. Each week, he creates a blog post for the top question. If you have a question, head over to LinkedIn to communicate directly with Mark.
