Earlier this month, our team travelled to Barcelona for the EPP Manufacturing Pricing Forum 2024.
I had the honor of taking to the stage to discuss how manufacturers can maintain control of profitability in the face of changing economic forces. For anyone who couldn’t be there, here are some of the take-aways from my session.
Navigating the new normal in manufacturing pricing
Since the turn of the decade, the manufacturing sector has faced unprecedented challenges. Although inflation and energy prices have started to stabilize, recovery is fragile and markets remain volatile. Several countries are officially in recession, with others like the UK, Sweden and France precariously close. In this challenging environment, pricing remains the key strategy for manufacturers to protect profitability as well as short and long-term business growth.
The complexity of modern manufacturing pricing
Manufacturers are increasingly recognizing the need for nuanced pricing strategies tailored to factors such as region, product group, and customer demand. However, our research reveals a gap in the industry’s capability to execute these pricing tactics effectively.
94% of businesses are concerned about the speed at which they can react to fluctuating costs or market forces with price changes. This is largely the result of outdated pricing technologies and complex manual processes, with 86% of businesses citing lost profits due to slow pricing changes and pricing errors. In practice, this results in an estimated average income loss of €420,000 per year.
Moreover, 64% of businesses report that they lack the ability to digitally model price changes, hindering their capacity to assess margin impact before rollout. Meanwhile, 50% of businesses rely on spreadsheets to supplement their ERP for pricing management.
The limitations of this manual approach mean organizations struggle to execute pricing strategies with the agility needed in the current economic landscape.
The right time to embrace price management technology
With more volatility on the horizon, now is the right time for businesses to review their pricing practices and look to technology to help them realize the potential of their pricing.
Flintfox helps manufacturers with complex pricing and rebates to manage pricing and rebates fast and accurately, enabling them to keep up with the pace of change happening around them.
We’ll be sharing more insights from the pricing community soon but in the meantime, to find out more about how Flintfox helps manufacturers, get in touch, our team would love to hear from you.
