Configured Product Pricing Can Be A Constant Challenge
How do you figure out how to price a product you have never sold before and may never sell again? How do you determine the optimal prices for configurable products? For many companies, their offerings are anything but “standard” — they’re built or configured to satisfy a customer’s unique specifications. And given all of the variables involved, the configured combinations that are possible can easily number in the thousands, if not millions.
Developing List Prices For Each Product Will Always Fall Short
Of course, list prices and standard costs are rarely available for every possible configuration or specification. And there will be very few, if any, examples of prior sales of the exact same configuration to a similar customer to provide any sort of benchmark about market price levels. And even if developing standard list costs were achievable for every built-to-order product, it still wouldn’t take each customer’s price response into account.
It’s Impossible To Manually Analyze Every Product Combination
Companies usually end up flying blind when determining what to charge for configured products. You simply don’t have the resources to do a deep-dive analysis on every configured quote that comes in — even if you could, it would only add to the troubles. Customers and channel partners would start to grumble about the lack of pricing consistency. And close rates would be lower than they really should be because it simply takes too long to turn around a configured quote as multiple groups attempt to give their input.
Custom Products Need Custom Prices
Every customer values each configured product differently. To capitalize on that, you need to be able to determine which configuration attributes and options within the configuration are really driving the market price. And then you need to determine the impact of different deal circumstances and customer classifications to better understand how each customer responds to price. As challenging as all this might sound, the data already exists — with more coming in on each order — it’s just a matter of using it your advantage.
MarginMax Captures Millions You Could Have Left On The Table
Zilliant MarginMax is the go-to solution for many configured product manufacturers. They use it to determine how each customer values each unique product, as the deal is being quoted. Salespeople can create quotes the way they always have, while receiving immediate pricing guidance that is precise and specific to the unique configuration and deal. It all happens at a level of scale and speed that could never be matched by manual processes. And it works with the dirtiest of B2B data — which is often the norm if you’re selling configured products.