Reduce Price to Improve Revenues and Margins

CHOICE 1 OBJECTIVE: ATTRACT CUSTOMERS

CHOICE 2 SEGMENTS: PRODUCT COST SAVINGS SEGMENT / SEGMENTS WITH MANUFACTURING BUSINESS FUNCTIONAL COST SAVINGS POTENTIAL

CHIOCE 3: USE A COMPONENT OF PRICE TO REDUCE THE LOW PRICE SPREAD:

Create Cost

1. Change the Benefit Package Examples>>

Make Cost

1. Change the Benefit Package

   • Change Function and Price together Examples>>

   • Change Reliability and Price together Examples>>

   • Change Convenience and Price together Examples>>

   • Make more than one change in Function, Reliability and Convenience benefits, along with the Price change Examples>>

2. Change the Basis of Charge Examples>>

3. Change the List Price Examples>>

4. Change the Optional Components of Price

   • Extend a discount in kind Examples>>

   • Provide a free, or heavily discounted, product from the company, other than the product on sale Examples>>

Sell Cost

1. Change the List Price Examples>>

2. Change the Optional Components of Price

   • Offer a coupon Examples>>

Serve Cost

1. Change the List Price Examples>>

Multiple Functions

1. Change the Benefit Package

   • Change Function and Price together Examples>>

   • Change Reliability and Price together Examples>>

   • Change Convenience and Price together Examples>>

   • Make more than one change in Function, Reliability and Convenience benefits, along with the Price change Examples>>

2. Change the Basis of Charge Examples>>

3. Change the List Price Examples>>

4. Change the Optional Components of Price

   • Provide a free or heavily discounted product from a third party Examples>>

   • Extend a payment term Examples>>

<<Return to Choice 2