Zilliant Customers - Market-leading Distribution Companies

Optimized Prices On Both Items and Freight Add Millions To The Bottom Line

A multi-billion dollar high-tech reseller deployed ZPPS Optimization and ZPPS Analytics in one of its divisions that catered to small and medium businesses. Zilliant's Precision Price Segmentation™ identified over 6,000 discrete price segments based on a statistical analysis of deal attributes such as account size, product mix and rebate level, and uncovered significant opportunity for margin improvement from optimized prices.

Armed with Zilliant’s deal-specific price recommendations, sales teams averaged 250 basis points of additional margin on the thousands of orders placed each day. This yielded a 10% increase in profit dollars, and added over $800K to the bottom line every month.

After expanding the deployment with ZPPS Deal Manager, and rolling out the solution to an additional division catering to enterprise customers, the distributor also began using Zilliant to optimize prices charged for freight on each order. This alone added close to $1M of profit in the first year of use, over and above the almost seven point margin increase on the order items themselves.

Market-Driven Pricing in Six Weeks

A multi-billion dollar food distributor deployed Zilliant in six weeks to provide optimized price recommendations for the 200,000 SKUs that it sells to 70,000 business customers. The company had previously used a cost-plus approach to setting prices that was characterized internally as “one price fits all," with the perceived result that prices almost never aligned with specific market circumstances.

Zilliant identified thousands of opportunities for the distributor to set differentiated, market-based prices on its orders, e.g. establishing a 60-cent price difference on a case of lettuce sold to different types of restaurants in different geographies. Most opportunities involved similarly small price adjustments, but, across the millions of transactions completed every year, optimized prices have added more than $1M every month in incremental margin dollars to the distributor’s bottom line, with a 20% increase in overall margins.

Managing Prices Throughout a Dealer Network

A top 5 distributor of office products in the US began using Zilliant Analytics and Optimization a little over a year ago. As part of the initial phase of the implementation, the company conducted a formal test-and-control study over six weeks to assess the effects of optimized pricing. This involved several sales regions pricing under Zilliant price guidelines while several comparable regions continued to price using then-current practices.

The exercise showed a $300,000 margin lift from optimized prices, all else equal, which works out to a $1.2 million annualized margin increase when projected to the full set of business covered in Phase I of implementation. Subsequent financial results have borne out the findings from this initial trial.

Some of the realized benefits are attributed to the distributor’s dealers’ ability to access Zilliant Analytics in order to assess their own pricing performance. This has not only enabled dealers to identify and take action on opportunities to improve their own pricing decisions, but has served as an incentive for dealers to work with this company instead of competitors, further increasing sales and profits.