PRICING DESIGN AND SYSTEMS

In order to make sure that you get enough profits out of your products and customers, many companies charge the wrong prices which either lower their profitability or lower their sales below the potential. Because price changes has immediate effects on the bottom line, a 2% price increase in price inelastic product groups usually increase the bottom line profit directly with 6-8%. In price elastic product groups the same price increase typically lower the overall profitability with 5-10% and a price reduction of 2% might increase total profitability by 5-6%. Most companies we have worked with have huge problems knowing if there prices are right and have few or no organized system for managing their product pricing. This is why we provide price reviews, price strategy and design, and help to select, install and use price management systems.

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