Question

Topic: Strategy

Pricing Policy Statement

Posted by Anonymous on 6/18/2007 at 11:10 AM ET 250 Points
Hello everyone! I am working for for a company that operates in industry goods sector, namely diversified machinery, such as producing parts for heavy equipment. We are in the process of creating new pricing policy statement. It will be a guideline to how to set prices, who will set prices, terms and conditions, return policies and etc. I was wondering if anyone knows a website where i could get a sample pricing statement template, what they should look like and include. i have some internal documents to draw from, but would like to see how the rest of the world might write them up. Thanks beforehand!
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RESPONSES

  • Posted by Frank Hurtte on 6/18/2007 at 12:18 PM Accepted
    I work with Industrial Equipment Distributors, Manufacturers, Systems Integrators and VAR's. Unfortunately there is little on this that is available to the public. And, unfortunately a goodly about of what is available privately is of low quality.

    here are some pointers...
    1) set up matrix pricing is possible
    2) segment pricing if possible
    3) terms and conditions need to be very specific and the end game should be carefully considered
    4) cover returns - they will come up eventually
    5) cover cancilations
    6) if you have distributors, resellers, or others clearly define where they fit in.

    If I can be of further assistance you can contact me via my profile.

    Frank Hurtte
    River Heights Consulting
  • Posted by Chris Blackman on 6/22/2007 at 10:52 PM Accepted
    Wow! That CN link Jon provided above certainly has a very comprehensive policy for rail freight customers.

    Makes you wonder why every large company doesn't publish a transparent policy like that on its website, clearly delineating who pays how for what, when, where, and under which circumstances.

    All that information, and not a single rate or price disclosed. Well done!

    Jon's been around quite a long time on the forum and he's one of the best if not THE leading pricing specialist here at MarketingProfs.

    If you really need to do this project well, I recommend you consult professionally with Jon's company to get them to draft a policy for you. You should be able to contact him via his profile.

    And no, I don't get commission. I'm recommending him because I have immense respect for his work.

    Hope that helps.

    ChrisB

  • Posted by Mushfique Manzoor on 7/2/2007 at 4:27 AM Accepted
    hi there

    although my area of work is different from yours (has spanned from FMCG to service to telecom), my 2 cents are...

    you can devise your pricing strategy based on a matrix of segment and category. For each of the categories segments you will have pricing of different segments.

    definitely for the Premium segment your margin will be higher than the Low segment or Very Low segment. THe same is true for your agents/dealers so that they are interested to sell more of your premium products/brands.

    you pricing strategy also depends on some factors like
    1. level of competition and their pricing strategy
    2. your expected level of ROI
    3. cost of your goods/products

    hope this helps

    cheers!!
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