Ariel Baños, economist and author of " Los secretos de los precios” (The Secrets of prices), writes in Fijaciondeprecios.com:
"’Why worry about prices, if ultimately everything depends on the market? It is better to allocate resources towards reducing costs and increasing sales, which are actions within our grasp and have a direct impact on the outcome.’ This is how a CEO of a major company justifies the neglected place that pricing strategies hold within their organization.
This argument is representative of the views of many companies. There is widespread ignorance about the benefits and tools available to strategically manage prices.”
Baños cites the following 5 reasons why companies should not ignore this issue:
1 - Price is the variable which has the greatest impact on results
2 – It is possible to actively manage prices
3 - Price wars do not end in winners and losers
4 - More sales do not always mean higher profits
5 - Organization and processes are key to managing prices
Read the full article, in Spanish, in www.Fijaciondeprecios.com
More on this topic
November 2011
There is no faster and more effective way of dooming a good product to failure, than by choosing the wrong pricing strategy.
Companies often put great effort and investment into launching new products. However, everything can go wrong when the pricing strategy fails. Let's look at five examples that can ruin a good project, according to Ariel Baños, economist at Fijaciondeprecios.com and author of "The Secrets of Prices" (Ed.
February 2012
The producer will submit to the National Police a complaint for obstruction of sales and distribution of chicken by groups of traders in some parts of Managua.
Cargill will make a formal complaint with the National Police on Thursday against a group of traders who are preventing the distribution and sale of poultry in some parts of the capital of Nicaragua, said Jose Adan Aguerri, president of the Superior Council of Private Enterprise (COSEP) .
May 2011
Strategies and new low price offers are being prepared before the arrival of the Walmart name in the country.
The fight to win customers in an increasingly aggressive market has been reinvigorated in recent weeks, since the retailer Walmart decided to change the name of its supermarkets from Hipermás to Walmart.
January 2011
Starting the first half of January, an increase between 5 and 7% is being discussed.
Oscar Armando Calon, director of the Honduran Chamber of Construction Industry (CHICO), noted that they are analyzing the new price in light of increases in raw materials worldwide.
"The construction industry has been hit hard by rising raw materials so according to communication from distributors, the increase will be between five to seven percent; this will impact the industry even more, while it still does not recover from last year´s deficit," he told Latribuna.hn.
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