Competitive Price-Setting

Domains

Marketing, Sales, Accounting

Specific Targets

Offering products and services at prices that work well in the current market and of whom the impact on one’s own profit is always transparent.

Usual results

  • Flexible price-setting to allow the conclusion of certain deals
  • One-time price-setting to sell overcapacity in a segmented market
  • Responsabilization of the sales team when giving discounts. Anticipation of problem periods when resource costs rise.
  • Anticipating internal capacity problems

Specific techniques

  • Throughput accounting
  • Calculation of the immediate gross added value per product and of the global added value per product. This is used together with DeltaOE* and buffermanagement to calculate the anticipated profit per period.
  • Sensitivity: T/constraint unit. The exploitation of constraint-resources has a direct impact on profit. This indicator allows for the steering of sales tactics, on both the short and the long term.
  • Resource availability. The graphical information about critical resources: possibly reserved, over secured, potential shortages, etc, is crucial when taking on a commitment for a costumer.
    Standard supply times do not always show reality. The impact of new orders. Theoretical or average numbers are useless when an important order is added on top of existing orders, especially when there is a risk of bottlenecks
    The impact on all orders is the only fair judge
  • DeltaOE: Differential operating expenses
    This indicator belongs with the real loss/profit calculation of its corresponding periods. Sometimes this is totally different from what cost price systems suggest. Buffer risks (monitoring of immediate waiting lists).
    In conjunction with Buffer Management de probability of risks is calculated for reaching the projected numbers.
  • POOGI: Reliability of resources/ suppliers/subcontractors

 

Our Offer

Diagnosis study or plan of implementation

Complete courses with possible transfer of know-how will be guided by TOC experts

Adapted and integrable software is available