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Strategic Pricing helps the CCC Group deliver the right products to the right customer segments at the right price. It enhances the decision-making processes of our commercial teams by giving a better understanding of the dynamics when setting customer-item specific prices. Launched in September 2015 and after incorporating a new pricing process in June 2016, its positive effects are already noticeable, with potential benefits of up to 20 million euros per year.
Historically, we have focused on volume to ensure the optimal usage of our capital-intensive production facilities. Through Strategic Pricing we are shifting from a more general pricing model based on product and/or market to a customer-item specific model focusing on increasing margins where possible.
Combining science and art
Thanks to the Strategic Pricing framework, the “science” behind Strategic Pricing, the PLM and Sales organisation have identified opportunities to negotiate higher margins for several projects.
Emiel van Dijk, Global Strategy & Innovation Leader explains: “By adding science (data analysis and information) to the art of sales, we are much better equipped to see where we add value to the market and ensure we are rewarded for it.”
“By giving a range specific to the quote the salesperson is working on, rather than a more general price threshold, sales managers are more empowered to get the best possible deal out of their markets,” adds Sjaak Burghoorn, Cluster Lead CCC Europe Export Cluster. “We can now be proud of our scores and prices relative to the markets we sell in.”
The PLM team has better access to customer data thanks to Strategic Pricing. “Easy to understand graphics help us identify pricing trends and customer specific opportunities,” says Marcel Nouel, Product Line Manager cocoa powder. “Armed with these insights we can support Sales to negotiate with more confidence.”
Strategic Pricing priorities for the 2016-17 fiscal year
Launched at the end of the 2015-16 fiscal year in the CCC Europe region, the priorities for 2016-17 are embedding the new tools and governance processes throughout the organisation, and underpinning more complex negotiations. Obtaining more market information, mainly on the competition, is the next step in the rollout.
However, benefits of Strategic Pricing are clearly noticeable already. Says Naomi Pearce, Sales Manager CCC Europe West Cluster: “The new strategic emphasis on understanding value as well as volume has improved sales capability and confidence to deliver hugely exciting, tangible, value-driven results.”