AboutLeo Lingham Expertise Any questions around sales, sales planning, sales development,
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Experience 18 years in working management covering business planning,
strategic planning, marketing and sales management, management
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24 years in management consulting covering business planning,
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Expert: Leo Lingham Date: 5/4/2008 Subject: How to go about pricing issues
Question Hi Cheif ,
I'm selling auto aftermarket spare parts , basically through distributors .
We have competitors with almost similar quality and reputation,but still our price is higher and our company is not ready to compromise .
Our customers are keen only on the price .
How can we go about this issues .
Thanks ,
Regards ,
Tamer
Answer TAMER,
STEP 1
-review the demand/ supply situation in market.
-review the growth rate/ potential of the market.
-review your brands position in the market / competitive position
-review the customer perception of your product.
IF ALL THESE INDICATES, A REAL DOGFIGHT IN THE MARKET.
STEP 2
-leave your list price intact.
-workout a short [ say 6 months ] strategy
PUSH STRATEGY
-offer the distributors attractive volume based trade discounts.
-offer the distributors special incentive for holding higher stock
-offer the distributors ''sell out'' bonus for the 6 months
that is, if they buy 1 mill. dollars from you / sell out all the
1 mill. dollars, they should get the ''sell out'' bonus.
PULL STRATEGY
-for the 6 months , offer the consumers special price package
like buy 3 for the price of 2.
-help the distributors with merchandising support.
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