Fluid Power companies make millions of decisions each day and the goal is to maximize their goals and objectives with each decision. The decision, which is usually made more than any other, is how to price a product for each customer. Often times the only variables which are included in making this pricing decision are - cost and a targeted margin percentage. Thus there is a huge opportunity to improve the efficiency and effectiveness of these pricing decisions.
The reason why pricing is such an enormous challenge for most Fluid Power companies is due to the complexity of this decision. Trying to manage 1000's of products being sold to 1000's of customers across different geographies creates millions of price points handle. Companies are overloaded with huge amounts of data yet posses' insufficient tools and processes to turn this big data into information to help their business.
The sales teams of most Fluid Power companies are left to price this complexity without any tools, training or incentive other than maximizing sales volume. If the only tool you have is a hammer, then every problem you face is a nail.
Top Strategic Pricing Opportunities in Fluid Power
- Are you getting properly compensated for your value-added services such as assembling components into finished goods?
- Different customers have different cost-to-serve, are your sales people needlessly giving away margin on some orders?
- Are you optimizing your prices in your manufacturer mandated price ranges product segments?
Top Benefits of Strategic Pricing in Fluid Power
- Creates volume lift opportunities
- Fuels profitable growth
- Identify margin lift opportunities
- Adapt to the competitive threats in your market
- Leverages your market strengths and value differentiators
Top Strategic Pricing Opportunities in Fluid Power White Paper
Fluid Power Distributor's Success Stories
Our Fluid Power customers include:
- Parker Hannifin
- Livingston & Haven
- Air Hydro Power
- Anderson Pump
- Dakota Fluid Power
- Iowa Fluid Power
- Ozark Fluid Power
- and more...
Livingston & Haven
"This whole new way of thinking about pricing has allowed us to change the direction of our margin percentage. Our process requires sales people to get pricing adjustment approval from someone on the management team and that little delay often allows them the opportunity to think about the value we provide and justify the L&H price in their own mind."
Bob Decker, Director Strategic Initiatives - Livingston & Haven
Air Hydro Power
"Nothing that we have done in our business model has produced the kind of results we see with Strategic Pricing Associates' price process. It has interacted with every fiber of the way we see ourselves in the market. And, it has been responsible for moving us into the high performance side of the association's Profit Analysis Report (PAR)."
Matt Ott, Owner - Air Hydro Power
In October of 2004, six Parker Distributors embarked on a twelve month journey to implement a Strategic Pricing discipline in their businesses. This was the beginning of the Parker Distributor Strategic Pricing Program conducted by David Bauders of Strategic Pricing Associates.
David was just finishing a four year contract with Parker Hannifin to implement Strategic Pricing at all of its manufacturing divisions. An article on the front page of the Wall Street Journal on March 23, 2007 described Parker’s major success story of increased profits through Strategic Pricing.
The original six distributors have all become high financial performers, as compiled by the NFPDA. Today forty-five Parker distributors are participating in the program, with more scheduled to start later this year.
Twelve Parker Distributors presented their Strategic Pricing success stories to Parker executives in Cleveland, OH during their Graduation from the program. The annual sales of these distributors ranged from $12 million to over $70 million. Collectively, these twelve distributors are projected to earn $9 million in additional pricing profits in the first year of implementation. A review of the Strategic Pricing Results for these distributors shows that each company earned a significant ROI.
Learn More About The Power of Pricing
We serve the world's largest distributors, such as Grainger, Wesco, Industrial Distribution Group, and ThermoFisher Scientific; Caterpillar dealers; as well as hundreds of mid-size and small distributors and equipment dealers. Our distribution coverage spans all major segments: industrial, electrical, building products, medical, fasteners, fluid power, paper & packaging, plumbing/HVAC, chemicals, food.
Hear what our distribution and manufacturing clients have to say about how Strategic Pricing improved their profitability.
Read real life case studies on how manufacturing and distribution companies are working with SPA to leverage their own unique pricing opportunity.