North American Paper Manufacturer Reduces Time to Make Pricing Changes by 80 Percent

SUMMARY

A leading multibillion-dollar paper manufacturer in North America used manual pricing methods that were too time-consuming and cumbersome for efficient price changes. They had no way to identify or track marketing opportunities and disparate tools and data sources made it difficult gauge overall pricing and profitability. The company needed a focused pricing strategy across the organization and turned to PROS.

Working with PROS, the company streamlined data systems and processes into a standard source for analytical data across the organization. This enabled rapid pricing changes with complex rules for very large numbers of transactions and also helped them identify opportunities to capture additional revenue. They now have newfound flexibility to enact price changes in response to changing situations and increased visibility into how well sales are tracking toward company goals.


CHALLENGE

This leading paper manufacturer’s pricing processes weren’t keeping pace with the growth of its business. Their existing processes used several tools and different data sources, and the data didn’t always match. For example, calculations in one data source could differ substantially from those in another, making it difficult to understand what was going on. The company needed a focused pricing strategy across the organization and a reliable, standardized source for analytical data that was integrated with SAP. With a new strategy and automated processes, the company was hoping to achieve three main goals:

  • Reduce the time required to change prices.
  • Bring new flexibility to the pricing process.
  • Eliminate pricing errors.

SOLUTION

PROS Professional Services team held initial discovery sessions onsite with the company’s analysts, sales reps, and executives to gain insight into the company’s dayto- day pricing practices and identify several forms of “pricing pain.” These sessions revealed problems in the process and approval of price change, as well as the inability to track and take advantage of marketing opportunities. The paper manufacturer chose PROS to implement a pricing solution based on PROS track record of success and the expertise of PROS Professional Services team. By choosing PROS as its partner in pricing, the manufacturer was able to integrate a solution with SAP and become self-sufficient in managing and maintaining the system in less than seven months.

The PROS solution provided several advantages:

  • Complete integrated pricing solution that provided faster time to value and lower total cost of ownership.
  • Real-time integrated science to drive maximum margin and profit improvement.
  • Guaranteed project success that delivered demonstrable ROI within 30 days.
  • Industry-leading experience and expertise that ensured long-term success built on a culture of partnership.

RESULTS

Working with the manufacturer’s IT integration partner to assure successful implementation, PROS began with a 30-day Proof-of- Value implementation. From there, the company was immediately able to identify margin improvement opportunities and put the PROS solution into full production.

The PROS solution is fully integrated with SAP and provides pertinent and timely pricing guidance recommendations based on rules that allows for faster quote turnaround and in some cases, automatic approvals. Prior to the PROS solution, price protection agreements often required 30-day notice at the beginning of a quarter ---a very labor- intensive and time-consuming task. The company now enforces pricing rules automatically. This eliminated the practice of raising prices across the board and following up on exceptions by updating them manually.

Now, the paper manufacturer’s price analysts have reduced the time required to make price changes by 80 percent. In segmenting customer data with the PROS solution, analysts can group customers pricing behavior into categories and identify the “Willingness to Pay” for each product. Based on this information, sales reps get pricing guidance in the form of floor, target, and stretch prices. The PROS solution has also given the company increased flexibility in how it is able to make price changes. Before PROS, some price changes took too much time to implement. Now, sales reps are able to react to changing market situations and get immediate price guidance based on reliable information.

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