In our latest article exploring the timely and critical issue of price increases, we present a step-by-step guide to how to plan and implement one successfully.
For some companies, price increase implementation seems to be an ongoing nightmare. They experience a wide spectrum of problems ranging from clients’ pushbacks to unfavorable commercial agreements that alter pricing actions with customers.
Some companies have great clarity about what to do, but their teams lack the confidence and capability to deliver a price increase, and halfway through the process the plan starts to fall apart. Other companies fall victim to a lack of preparation and have to alter or delay their plans due to unforeseen threats and countermeasures from clients.
Pricing is widely considered a key element of revenue growth management (RGM), and this has been a key source of profitability growth for consumer goods companies. Getting the right pricing for the right product and being able to execute price increases at the right time and within the company parameters has proven to be both critical, but also challenging to align on with customers.
The game is not so much about knowing what the right price needs to be (something that has become easier to figure out), but to be able to plan and execute the price increase cleanly with minimum business disruptions.
This guide sets out some key principles to guide you on how to implement a successful and well executed price increase from a negotiation perspective. While not designed to be the ultimate and definitive guide on the subject, it is nonetheless a comprehensive starting point.
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