How do I become Uber competitive on prices?
Posted on 29th November 2018 at 12:05
As a business you want to offer great value for money on the products or services you sell and make a healthy contribution margin at the same time, but how do you become uber competitive?
If you do a web search on competitive pricing, you will find millions of entries. Many of those links will lead to articles, blogs, and videos that list their version of the 5 Cs:
Concentrating on where Procurement can add value, setting prices can be both simple and complicated. It is simple in that your customer wants to know, “How much does this cost?” or “what is the price per unit?” It is also simple if you rely on rules of thumb like “cost + 25%.” However, this alone won't win any prizes against a competitor.
Initially organisations place a lot of energy into the building a profile of the 5 C’s with the greater focus on cost. However, over time cost starts to take a back seat and, in some cases, completely overlooked.
To stay “uber competitive” the cost needs to be regular reviewed by strategically analysing supplier & category spend to assess how rising cost pressures will affect growth objectives and market share potential. Then setting objectives based Identified shifts in key cost components.
Pro Outsourcing can assist you to strategically analyse your supplier & category spend , establish understanding of price & cost drivers, define business requirements, supplier market situations, highlight trends and drive the objectives in supplier relationship management, Categories, Sourcing, supplier selection and negotiation.
Tagged as: analysis, Categories, category spend, competitive, cost drivers, cost pressures, cost reduction, costsaving, Sourcing, spend
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