Expert Point of view :
As quoted recently in the Ernst & Young publication (original here) :
"Pricing physical products is often complex, involving more than simply the cost of production – yet it remains a guessing game in many cases, says analyst Pierfrancesco Manenti at IDC Manufacturing Insights.
For manufacturers, visibility of the elements needed to price products optimally has been relatively blurry, but emerging tools and specialists can change that.
For the average manufacturing enterprise, pricing is typically a very operational, internally focused task. The managers who do it tend to be relatively junior and they generally create prices associated with the cost of production.
The imperatives for taking a more sophisticated approach to pricing are growing, however, thanks to keener competition and tougher economic times. According to Manenti, globalization and the rise of more informed end customers are heaping further pressure on companies to develop their pricing process.
Manufacturers have become more internationalized, so finding the right price in different countries is extremely important. Consumers are also increasingly using social and mobility apps to get information about products before buying. This is impacting the whole supply chain. The market is moving faster, so companies need to take decisions, in respect to prices, faster.”
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