Price Consulting In 2023 & 2024
How Can A Pricing Consultant Help ? The present business climate takes no prisoners. The tough and astute forges ahead while the not-so-astute keeps struggling and struggling until eventually, many fade away.
It, therefore, becomes important for all companies that want to preserve and grow their profit margins to never stop adapting and upping their game plan.
Improving pricing and profitability capabilities should rank high on that plan.
If you’re running a company; ever-increasing competitors, sophisticated procurement teams, and sluggish economic growth will continually try to whittle your profit margins.
That’s why you need a pricing expert with specific knowledge of your industry to provide a tailor-made pricing strategy & process for you.
While it’s good to learn which pricing scheme is working for other companies or sectors, it’s not advisable to implement it full-on in your business without taking into consideration your brand equity and other vital factors.
How Can A Pricing Consultant Help?
A pricing consultant can help determine the best pricing scheme for your goods and services.
They co-create with staff in all departments to know the cost of products and work with marketing personnel on appropriate promotions and campaigns.
The costs of warehousing, shipping, handling in addition to other related expenses are also considered before they give you a base price.
And this is barely all. One of the things that make it all so important for you to consider pricing strategy consulting is this:
Using an outsider (even though you have an in-house pricing manager) makes it possible for the board to have an unbiased opinion.
And an untainted opinion is necessary since whatever pricing the consultant develops must satisfy the management team/business owners and the customers all in one breath.
If one side suffers, sales may slump or you may have to deal with unhappy shareholders and/or owners.
Another crucial aspect you need an expert for is the area of brand equity (worth or value of a brand).
The price of whatever you’re selling should match your company’s positioning in the marketplace.
The two elements (price & positioning) need to appear fair and logical in buyers’ minds for your products to be successful in the market.
If your company is setting out to introduce new products or services – whether innovative or just new-feature-added product – pricing consulting can help you find the right selling price. This can be done in any number of ways.
Vital factors that are considered include base prices together with any discount the company may want to extend to specific dealers and retail partners.
Additionally, your consultant will consider the kind of image or message you want the pricing to project among target consumers.
A good pricing strategy expert should also be able to create a “dashboard” that would help you detect margin leakages and respond faster to pricing opportunities.
Price Consulting: A Vital Post-COVID Recovery Element for Your Business
We all witnessed how the coronavirus slowed down a large chunk of business growth and activities to a crawl. Many companies are just now gradually regaining lost ground and revenues.
Working alongside an industry-specific expert to evaluate your sales and pricing strategy will help you survive and recover much faster than simply cutting costs.
The first port of call the expert will likely be to improve is your margin and EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization).
To deliver an actionable and more accurate result that would help your company thrive better, most consultants would want to do a conjoint analysis and look into the pricing maturity of your company.
Conjoint analysis is a form of research that combines statistical methods and real-life scenarios to measure the value customers place on a consumer good or service.
And pricing maturity will reveal the market structure and your company’s competitive position.
Key Takeaway
Including pricing management into your company’s post-COVID recovery plan is a wise step towards growth.
However, it requires new data, tools, and skills with a strong focus on pricing and margin management.
With price consulting, you provide your company with the needed resources to grow. Likewise, EBITDA and margin management also get the attention they deserve.
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How Can A Pricing Consultant Help?
Baydhir Badjoko
MD, The Consultants bvba