Overcoming the three most common pricing challenges | Customer and Marketing | Deloitte Netherlands


Overcoming the Three Most Common Pricing Challenges

The Future of Sales

What sales reps want is to configure complex products and services, price them accurately, and generate quotes for customers in real time, while taking account of customer types, complex configurations, costs, competitive prices, and geography, together with their business priorities. Based on our experience, these are the top three industry pricing impediments that impact sales transformation: poor pricing strategies, error-prone pricing and slow quoting process. Read more about each of them in this article.

Overcoming the Three Most Common Pricing Challenges

Pricing & quotes can be challenging for businesses that sell complex and highly customizable products or services. Discounts, special features, and tailor-made product additions add more complications, especially if you have to do manual calculations. As a result of the intricate pricing process, errors often creep in. In this article, the pricing topic will be explored in detail, with a deep dive into the three most common challenges – poorly formulated pricing strategies, error-prone pricing, and delayed quoting – companies are facing today when working on their pricing process. By doing so, we will also explore how the CPQ (Configure, Price, and Quote) tools can serve as a cost-effective solution in those instances.

1. Poor Pricing Strategies

Market factors that affect pricing, competitors’ research, and target audience exploration are only a few of the essential elements used in estimating the price of a product or service price service, with VAT, taxes, or regulations acting as additional parameters impacting the final price.
Therefore, when a company launches a new product, they first need to formulate a coherent pricing strategy.
A clear and easily comprehensible pricing strategy is crucial to avoid inaccuracies, incorrect estimations, and inconsistent pricing, leading to price leakage and low profitability. CPQ solutions, unlike traditional configuration tools (e.g., Excel), can take into account a wide variety of factors ands well as multiple price models and automate the whole pricing process, increasing your efficiency and accuracy.

2. Error-Prone Pricing

Error-prone pricing is a tendency of having inaccuracies, which is another common obstacle in pricing creation. This can occur due to a variety of reasons, such as human error, lack of real-time data, outdated pricing models or insufficient data analysis, and the huge variety of factors to consider when setting prices. Let's explore them all, one by one.
CPQ tool avoids unnecessary errors by producing consistent pricing and thus contributes to a seamless experience both for your company and customers. The value-pricing tools (ROI/TCO calculators) the CPQ solutions include also enable sales representatives to position themselves more effectively in competitive situations. As a result, the CPQ tool ensures, on average, 38% fewer pricing errors.

3. Delayed Quoting Process

The third challenge facing companies offering complex products and services relates to the speed of pricing and generating quotes. Sales representatives considering so many product and pricing parameters spend a lot more time checking and comparing tables than it would be ideal. Without automation, quote generation is thus, a very time-consuming process, which can eventually result in quotes being delayed or not approved. . In order to avoid having to trade timely quote delivery for increased accuracy, centralized CPQ solutions unburden sales representatives from unnecessary manual work while offering streamlined collaboration and communication channels.

More information

For more information, please contact Eustache Bountzoukos or Joep Ruiter via the details below.

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