By Ian Ruskin-Brown
This ebook offers marketers with a pragmatic advisor on tips on how to set and deal with the pricing of either the goods and providers that they give. It outlines the method of deriving a pricing technique first, after which tracking the revenue implications of any pricing judgements made. In a logical, sequential layout, the writer units out easy monetary instruments corresponding to the revenue and Loss Account, and explains how top to appreciate, and negotiate inside of, the enterprise to enterprise and enterprise to client markets. In a weather of marketplace instability, the ebook is a well timed exam of pricing as an important useful self-discipline within the enterprise global.
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Additional info for Practical Pricing for Results
Example text
In Chapter 8 we take an overview of negotiation and the processes associated with it. The negotiation sequence is to: • Prepare one’s ground: preparation in negotiation, as in much else in life is the mark of the true professional. And in the negotiation meeting the aim is to: • Discuss with the other side the situations, re their objectives and room for manoeuvre, then • Propose a deal, as the starting point of the • Bargaining process: and when the two sides are approaching a consensus – the aim is to • Agree: and don’t forget to spell everything out.
A salesperson who can close a deal at a 10% discount is going to do it every time. The salesperson still gets 90% of their bonus. The problem is that the company often loses 100% or more of their profit on that sale (see Chapter 6). This problem can still exist even in bonus schemes that are based partially on profit or gross margin. Sales targets Another cause of poor price negotiation practice (as apposed to the skills outlined in Chapter 8) are ‘quarterly sales targets’. ’ Managers who push salespeople to meet periodic sales targets often either force the salesperson to use price to close the deal or, in the case of large accounts, the manager may actually take over the task of closing, and may often use price discounting as the primary tactic.
E. 906 has been derived from a reduction in costs. 1 are more potent in terms of their ability to contribute to the bottom line than are the right hand strategies. Thus, for a fairly simple profit and loss account, with the ratios as shown in column A, the left hand strategies are more than twice as potent as the rest put together. This is the difference between the contribution potential to the bottom line of effectiveness versus efficiency strategies. e. a 1% beneficial change to each of the revenue producing factors results in an improvement of more than twice any contribution that would be produced by a 1% reduction to the total costs of that organization.
