Profitable growth is a key priority for wholesalers, which face increasing pressure on volume and margins. Established companies and newcomers are competing on price more than ever before, and customers can now compare deals and terms online. Armed with this information, customers are demanding more for less. Such rising competition and transparency have transformed the wholesale market.
Pricing and sales effectiveness have become critical to helping wholesalers stabilize and increase revenue and profit. Typically, our solutions achieve sustainable margin improvements of 100 to 300 basis points in return on sales.
Too often wholesalers struggle to maximize their portfolio’s full revenue and profit potential because they don’t have a robust value pricing and selling strategy. They base their products’ prices on cost-plus metrics, tradition and gut feeling, instead of determining its value to customers. As their portfolio includes millions of products and thousands of customers, determining the right price for every transaction is complex and challenging. This becomes even more critical when hundreds of sales people can potentially make price decisions.
During the past 30 years, we have helped many wholesalers and distributors around the world successfully overcome these challenges and grow profitably. We have done so by developing leading analytical solutions specifically for the high transactional intensity of this industry.
Simon-Kucher deeply understands the challenges and dynamics of distribution and wholesale companies. We bring a hands-on mentality to our consulting work and are committed to deliver long-lasting solutions for our clients.
Our projects for wholesalers and distributors include:
- Optimizing list price-setting approach and tool support, to automatically calculate list prices for more than 500,000 SKUs every month, based on price elasticity and competitive insights
- Refining a discount structure, based on a systematic customer and product segmentation, to derive the optimal and defendable discount per segment
- Developing a service pricing strategy, to gain quick-wins and add value with service
- Deploying a project pricing approach and tool support to optimize pricing for project and tender requests based on customer, deal and portfolio dynamics (Peer PricingTM)
- Restructuring the sales organization and developing strategies, communication and negotiation tactics and materials for sales teams
- Establishing the positioning of a pricing team in the organizational structure, to monitor and continuously improve pricing performance (e.g., a reduction in manual pricing)
- Guiding the software selection process, including business architecture and functional use cases