03.
Pricing & Product
Rebuilding a manufacturer’s pricing model to optimise margins in a shifting landscape
Services : Pricing Optimisation, Competitive Analysis
Project Length: 5 weeks
Industry: Manufacturing
50+ staff
Engagement Snapshot
The Situation
A mid-sized B2B manufacturer was receiving feedback from customers and its sales staff on its existing product pricing. Competitors had adjusted their offerings and materials costs had risen materially.
The manufacturer was worried about losing its long-standing customers and remaining competitive.
The manufacturer wanted to explore alternative pricing methods including tiered pricing and value-based models for its larger customers.
Leadership wanted to understand shifts in the current and future competitive environment, implications of pricing on its margins and implementation approaches.
How We Helped
Our focus: Structured competitive analysis and clear pricing frameworks tailored for implementation
We were brought in to design a pricing strategy that balanced margin protection with market competitiveness.
Our role was to analyse the competitive environment, explore different pricing approaches and consider implications for existing and new customers.
Our work unfolded in four targeted phases:
1. Price and Margin Diagnostics
We reviewed historical sales data, pricing structures, and margin trends to identify high-value products being underpriced and accounts where discounting eroded profitability.
3. Pricing Framework Development
We performed analysis to highlight the manufactuer's positioning among its competitors, identifying areas of competitive advantage - leading to a tailored a pricing approach that aligned with business strategy.
2. Customer & Product Segmentation
We grouped customers by metrics including size, behaviour and relationship tiers. We analysed product metrics including market competitiveness, market positioning, perceived value and profitability.
4. Implimentation and Enablement
We created frameworks to communicate proposed pricing changes to customers and relationship managers. Materials focused on strategy, customer segment insights, market positioning and premium offerings.
The Impact
1 / Margin optimisation across product suite
High-value product margins were increased to reflect product quality while commoditised products were priced more competitively. Overall margins of >5%, with future cost increases now fairly considered.
2 / Insight into market pressures and customer tiers for strategic decision-making
Analysis of market competitive dynamics and customer segmentation allowing for more informed strategic decisions - including 20% greater allocation of relationship manager time to high-value customers.
3 / Stronger customer conversations
Clear value-based narratives for customers receiving price increases and/or discounts, managing trust and positioning the firm as a premium supplier.