While common, price overrides can be dangerous. They train your sales team and customers that price is negotiable and interferes with one of your primary goals: sticking to your pricing strategy.
If that doesn’t worry you, consider this: companies that grant high numbers of ad hoc price exceptions are more likely to experience price erosion across all customers.
An effective and mature pricing strategy includes a policy for establishing price overrides. But what would such a policy look like?
From experience, we know that managing override activity is a multi-layered process. It requires adapting your internal systems, developing new guidelines, and transforming your culture. But at the end of the day, your goal is to establish a framework to monitor and manage potentially dangerous price overrides. When we help our clients with the same goal, we use the following four-step process.
Step 1: Grow Your Awareness: Understand what pricing overrides are happening and why
Step 2: Determine Market Relevance: Set appropriate prices for specific customer and product segments
Step 3: Set Policy: Establish guidelines and controls around pricing authority
Step 4: Encourage Training: Empower the sales organizations with the tools they need to handle pricing conversations with clients
Let’s dig deeper into each of the four steps.
Step 1: Grow Your Awareness: What is Happening and Why?
Many manufacturers treat their distributors equally. They offer everyone the same discounts, the same promotions, and the same training programs.
However—not all distributors work equally hard for your business.
In this article, we’ll look at how the right distributor plan can help you get the most benefit from your distributor relationships and drive the business objectives you want to achieve. (more…)
Achieving significant pricing gains can feel like a long, hard-fought battle. This makes it all the more satisfying when the numbers start to roll in, validating your efforts and proving without a doubt that profitability is attainable.
The thought of losing those gains may keep you up at night. What safeguards can you put in place to protect the gains you’ve achieved and prevent your company from sliding back into past poor pricing habits?
We’ve closed the books on 2015 and 2016 is already off to a great start. If you haven’t already, now is a great time to evaluate what worked well and what didn’t work for you in 2015 to calibrate your 2016 efforts.
The most popular Tradesmen Insights posts of 2015 give us an idea of what content proved valuable enough to you to keep coming back and to share. Our top posts from last year represent many trends and challenges that aren’t going away.
Planning, strategy, content marketing, listening and adapting with the ever-changing algorithms that rule the web remain important issues into this year.
Since we started Tradesmen Insights many years ago, it’s undergone some changes, but the goal is still the same: to provide valuable B2T marketing communications information, advice and guidance.
What do you expect to be the top issues you’ll face in this year?
We’ve been hearing for years that print is “dead” and digital media reigns. However for B2T, print is still and important medium.
Join Matt Sonnhalter in the next installment of our Marketing Minute series to find out more about why you shouldn’t call time of death of print advertising.
To view other videos from Sonnhalter, visit our YouTube channel here and let us know if there’s a B2T marketing topic you’d like us to cover.
We’ve closed the books on 2015 and 2016 is already off to a great start. If you haven’t already, now is a great time to evaluate what worked well and what didn’t work for you in 2015 to calibrate your 2016 efforts.