Controlling revenue in B2B, as well as B2C, means being on top of what prices and discounts are offered to each customer.
Pricing in E-Commerce often involves updating thousands, if not hundreds of thousands of prices on a very frequent basis. While theoretically Microsoft Excel will hold over a million lines, in practice manual updates become very cumbersome and also miss out on a number of optimization options. This is where Price Management and Price Optimization software comes in.
Pricing in B2B sometimes including setting a Floor Price, i.e. a pocket price that sales people are not allowed to go below for a given customer, at least not without prior approval. They are usually internal numbers not shared with customers, for the obvious reason that any buyer worth his salt will immediately push for that price if he knew how low the sales executive is allowed to go. But what about what the sales person him or herself? Two main school of thoughts exist:
In business relations it is very much the norm that a variety of discounts or rebates are given to customers, which leads to that many customers have different pocket prices, or net net prices, after all those discounts. This is in itself a good thing, as it means that suppliers can differentiate discounting and final price paid, based on customer value and performance.
When it comes to implementing a dynamic pricing model in your business, once the model is established, the use of Price Management Software makes it much easier to run and update. Especially if your pricing requires on-demand pricing or very frequent updates (daily/weekly) across thousands of products.
This is an article in a series about Revenue Control. Check out the main article on Revenue Control here.
Are you looking for someone to speak about pricing and profit optimization at an upcoming event? Get a Stratinis Executive to come and speak:
Our partners over at PriceBeam are organizing an interesting webinar next week about Marketing, Price Positioning and Brand Health from a pricing perspective:
Don't forget: on June 7th we are organising a webinar about how dynamic pricing and machine learning can improve prices in e.g. E-Commerce, retail, and other industries with frequent price changes.