2022 Advice on Inflation, Dynamic Pricing & More
Welcome to 2022.
As we mentioned in our 2021 B2B manufacturing and distribution previews last January, the start of a new calendar year is not a clean slate, but it is an opportunity to take stock of the previous 12 months and prepare for the road ahead. In lieu of making predictions for 2022, some of our in-house pricing experts have taken the time to lend their advice to B2B companies. What follows is the first sampling of these forged-in-the-fire insights on various hot topics.
“Price agility is essential to avoid erosion from stale prices built on old cost values. Even if your pricing logic remains unsophisticated (i.e.cost plus), keeping up with those cost changes quickly is a must. Don’t be the company that takes 10 weeks to pass on a monthly cost change!”
General Manager of Commercial Excellence Barrett Thompson
Read more: How to Counteract Inflationary Pressure
“With inflation and cost uncertainties and other macro events, it is important to ensure you execute your stated pricing strategy.Make sure toreview how customers are transacting against price recommendations to ensure the strategy is being executed. It’s equally important to review results to understand if pricing strategy goals are being met, and if not, what new action plans are needed. Continued training on the price execution system for both new and existing sales reps is critical. My customers have also found success by considering additional data sources, such as competitive data, market share and inventory availability, to make the optimal pricing decisions during inflationary times.”
Director of Customer SuccessAlex Wilkerson
The Need for Dynamic, Real-Time Pricing:
“As you consider your 2022 goals, taking the first step towards your digital transformation is necessary to retain existing customers, stay ahead of competitors, and to grow market share. Digital transformation can seem overwhelming as you contemplate all the challenges such as current state data, technology, and business process. However, tackling it in smaller steps will allow you to create a foundation to build upon.
If you haven’t started the transformation yet, consider centralizing your business and pricing processes as the first step. This will give you the ability to provide real-time pricing to customers through your online store, customer portals, and your quoting system – ensuring your customer sees the same price whether they go online or to their sales rep. Zilliant’s 100% cloud-native platform can help build that powerful data-driven foundation, give your pricing teams flexibility through management and sales apps, and create a seamless buying experience for your customers.”
Product Experience Manager Sam Leung
“Online sales channels will keep increasing pricing transparency across the market, while supply chain disruptions will continue to present inventory challenges. This creates an imperative for B2B sellers to respond with dynamic price adjustments which reflect the real-time market reality.
If you competitor drops its price by 5% on a fast-moving item and they have 10,000 units on hand per their online sales portal, you may want to choose to take your price down to maintain the prior relative price gap. On the other hand, if your competitor dropped price 5% but they must put that item on back-order with an ETA of four weeks, you may choose to hold your price steady. Only with a dynamic pricing engine can you make these timely decisionsat scale across your business.”
General Manager of Commercial ExcellenceBarrett Thompson
The Right Tools:
“We can hardly predict the future, but we can expect to see even more uncertainty. My best advice is therefore to ensure you have the right tools to react quickly to changing market conditions.The right tools are those that allow you to embrace market changes as quickly as possible and implement the best customer experience.
To accomplish the first you must have real-time, cloud-native tools to pass on cost changes while taking new supply issues into account dynamically.
Capabilities such as timely quote and agreement turnaround, self-service web interfaces, complementary product recommendations and an omnichannel pricing strategy will improve your customer experience. Bottom line, if it’s easy to do business with you, customers will come back.”
Director of Business Solutions Consulting Thomas Delloye
“When dealing with issues like the recent Log4jvulnerability, you realize the true value of a cloud-native infrastructure. Our small but mighty team of operations engineers did a great job responding to the discovered vulnerability by having thousands of AWS engineers responding alongside us to make sure our infrastructure was protected was critical. Though we were targeted we did not have any exploit or breach.My advice for any B2B organization is to adopt cloud-native tools where possible going forward.”
Chief Technology Officer Shams Chauthani