Logically, manufacturing organisations should put 50 percent higher focus on Price optimisation and control rather than the typical pure cost reduction approaches.

The pricing structures for Tier1+ manufacturing suppliers are notoriously complex, with individual price agreements for hundreds of customers over thousands of part numbers. Complicated discounts tied to long-term agreements, volume based amortization amounts, numerous adders and subtractors, index based pricing for raw material commodities and foreign exchange components, all contribute to a huge risk for margin leakage.

A sound approach to effective price management and control starts with a state-of-the-art solution to maintain, analyse, govern, automate & intelligently manage pricing. Organisations using such digital tools have seen immediate benefits and measurable effects to their top and bottom-lines:

• 360 degree management overview: allowing real-time monitoring of prices, price risks and price impacts in all dimensions to drive transparency and ensure fast actions.

• Pricing intelligence: bringing data-based insights across products, regions and customers to maximise pricing.

• Accurate planning & forecasting: ensuring correct business strategies and decisions based on the best data quality.

• Process governance: implementing standard procedures and relevant controls on creation or updating of customer prices, especially discounts.

• Risk evaluation: identifying and quantifying risk embedded in pricing structures, such as index based commodities or foreign currencies.

• Automation & Intelligence: driving maximum user efficiency while at the same time reducing errors and pricing mistakes. Exploiting intelligence to make smarter, better decisions.

Reach out to us to learn about a state-of-the-art Pricing Management solution specifically engineered for automotive and manufacturing suppliers.