A sound pricing strategy remains a very effective profit lever in business and can propel your organization to the next level of performance. We typically find 3% - 8% return on sales in incremental impact driven by type of Industry and level of starting pricing maturity.
Many organizations lack the strategic mindset, execution ability, and discipline to unlock value from pricing. Without a clear “owner” of pricing and cross-functional linkages, many organizations struggle to set a strategy and achieve next-level pricing capabilities.
KPMG’s Pricing and Commercial Excellence team can help.
Our deep industry knowledge, cutting-edge methodologies, and industry-leading data and analytics capabilities can help you choose the right solution to help deliver value for your business and customers.
KPMG's pricing framework answer key questions...
Pricing strategy
Pricing strategy
- What are the different customer segments?
- How do product/service offering align with the business strategy and segments?
- How can we extract value from customer segments?
- What value extraction mechanisms and price bases most align to customer value?
Price setting
Price setting
- How much is the product/service worth to my customer segments?
- How do I ensure I get paid the right price for this product/service?
- How do I incorporate cost, competition, and value in setting prices?
- What discount structure do we need to drive customer behaviors?
Price execution
Price execution
- How do we integrate pricing processes with sales processes?
- How do we identify and correct issues with pricing and discount leakages?
- How do I manage and optimize my cost-to-serve customers?
- How can negotiations based on value and not price alone help sales achieve better win rates and price points?
Pricing embedment
Pricing embedment
- How do we ensure sustainability in setting and executing the right prices over time?
- Which are the people and capabilities requirements?
- What governance mechanisms and decision rights are needed to help pricing changes stick?
- Which data and tools support decision making and monitoring?
