A chemical company wanted to improve its performance. A cost-based pricing strategy had resulted in the company winning unprofitable business, leaving “money on the table” with current contracts, and had inadvertently put downward pressure on industry-wide price levels.

The client asked for help improving its pricing strategy, implementing tactics, and developing customer-facing employee capabilities.

We assisted the client’s marketing team in developing a new pricing approach that segmented customers – for example, by customer size, type, industry, order size, and application – and allowed the company to develop bid prices to these criteria.

We also helped the company change its price structure to influence and reward customers who bought profitable products in desirable quantities. Finally, the entire sales force received training in value-added selling and negotiation skills.

The resulting program led to a 5% increase in average price levels and a near 40% boost in operating profits.