How Quick Start for Agreement Management Helps Halt Margin Loss

By Zilliant

Nov 01, 2022

Quick Start for Agreement Management, which allows companies to deploy Zilliant Deal Manager™ in as few as four weeks, helps sales reps actively set and manage customer price agreements. But sales reps aren’t the only internal group to benefit from proactive agreement management. Quick Start for Agreement Management also enables better agreement tracking and management for pricing teams, which helps stop margin leakage and, ultimately, leads to improved profitability.

Why Do Mismanaged Price Agreements Lead to Significant Margin Loss?

Our previous blog went in-depth on how the Zilliant Quick Start package for Agreement Management empowers sales reps by streamlining the creation, management, and renewal of customer price agreements. But when viewing agreement management from a pricing team perspective, halting significant margin loss over time due to the mismanagement of agreements is a significant challenge.

Why do mismanaged price agreements lead to margin leakage? First, sales reps set up agreements without guidance and rely on intuition or gut feeling, often using a net price with no end date creating a “set it and forget it” conundrum. Second, pricing teams also often lack visibility into the margin health of all pricing agreements, which is necessary for understanding where margin loss is occurring and knowing which agreement lines need to be updated when corporate pricing strategy changes. Finally, given that customer price agreements are typically locked away in ERP systems, spreadsheets, or even email, a company’s ability to react to volatility and update pricing is far too slow.

The fact is that pricing teams need to ensure relevant prices are tightly aligned with how sales reps manage customer price agreements. Pricing teams need a proactive and scalable way to understand the profitability of agreements and quickly and accurately communicate and execute price changes with sales teams – especially in times of inflation and volatility.

How does Quick Start for Agreement Management Help Pricing Teams Halt Margin Leakage?

First and foremost, Quick Start for Agreement Management allows companies to realize faster time to value as Zilliant Deal Manager™, the market-leading agreement management application, can now be deployed in as few as four weeks. That means in about a month, an organization’s pricing team can use Deal Manager™ to execute agreement price changes without manual time-intensive processes and bulky spreadsheets and gain more visibility into how profitable customer price agreements are or are not. The following are two examples of how leading B2B companies are using Deal Manager™ to level up their pricing processes at scale, and ultimately, avoid costly margin leakage.

Example 1: Global Distributor Solves for Cost & Communication Challenges

One global print, packaging, and facilities solutions distributor was dealing with an increase in the frequency and intensity of cost changes coming from its thousands of suppliers. The bulk of the distributor’s business was also transacted over customer-specific contracts, which need to be updated often to account for changes in costs. As a longtime Zilliant customer, the distributor leveraged Zilliant’s price optimization solution, Price IQ®, to measure the price elasticity for each customer, which gave them an edge as supplier costs began to rise.

However, the distributor also needed to improve communication between pricing analysts and sales reps. The manual processes they were using worked for communicating and justifying price changes to a single sales rep, but at scale, these manual processes were simply too challenging in practice. With so many combinations, cost considerations, and price movements, the distributor implemented Deal Manager™, which seamlessly integrates with Zilliant’s price optimization and management applications. Now, prices generated from Price IQ® are automatically fed into agreement lines in Deal Manager™, and communication between pricing analysts and sellers is immediate. Deal Manager™ transformed the distributor’s processes; creating and managing agreement pricing, mass updating agreements, passing through costs and tracking sales team performance/adoption is now more straightforward than it’s ever been.

Read the Full Case Study to Learn More

Example 2: Global Staffing Services Company Optimizes Rate Markup, Accelerates Time-To-Quote

A global staffing services company was having trouble determining the optimal rate markup at the time of quote. Experiencing margin pressures in its North American staffing business, commercial leaders realized their current platforms were too complex. The company partnered with Zilliant and used Price IQ® to get more strategic about consistently setting an optimal markup for each quote.

Then, to move away from complex spreadsheets and quoting tools, the company leveraged Deal Manager™ to deliver Start/Target/Floor rate guidance, which presents the price in a simple format that includes the optimal bill rate and negotiation range. For the company’s pricing team, the combination of Price IQ® and Deal Manager™ gave them a long-sought common platform to create and deliver optimal rates. The bottom line for the company’s pricing team: no more manual rate calculation, more predictable sales team behavior, and much more time to devote to pricing strategy.

Read the Full Case Study to Learn More

How Does Deal Manager Increase Visibility into Agreements for Pricing Teams?

Deal Manager™, which can be deployed in as few as four weeks with Quick Start for Agreement Management, easily identifies agreements approaching expiration, creates renewal agreements from a previous agreement, and automatically updates master data and price guidance. Additionally, Deal Manager™ delivers valuable insights to pricing teams via embedded analytics, dashboard reports, and action cards to ensure agreement profitability. These insights help pricing teams evaluate key agreement metrics, including margin, expected revenue, and adherence to price guidance.

Get in touch to learn more about tackling customer price agreement challenges in as few as 4 weeks with Zilliant Quick Start for Agreement Management!

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