Pricing Excellence at Cleaning Chemicals Supplier

Situation​​

​Global cleaning chemicals supplier with both street and contract accounts

​Margin losses due to lack of cohesive pricing policy, processes and tools

  • Significant gross profit and operating profit variation across operating units
  • No policy on how to set list prices, discounts or evaluate contract accounts
  • Unable to understand pricing impact across businesses due to reporting differences
  • No direct ownership or accountability for pricing

Approach

Developed global pricing architecture, guidelines and processes

  • Systematic process for SKU cross-referencing and benchmarking
  • Guidelines for account treatment based on standard rules and street discount structures
  • Contract account process to design, measure and review contract accounts
  • Developed structure, incentives and tools to manage pricing excellence​

​Piloted new structure to refine approach/tools

  • Architecture and tools in two geographies for 6 months
  • Implemented structure, policies and tools to capture $15M+ in margin improvement​​

​​Established pricing governance structure and global roll-out plan

  • Pricing center of Excellence and operating unit pricing accountabilities
  • Pricing Operating manual; concepts, roll out approach, tools and structure
  • Global roll-out approach, timing, investment and PMO structure​​

Impact

Achieved consistent global pricing architecture and implemented ‘quick wins’

​Drove $15M in profit contribution from pilots and $60M+ from broad roll-out