What Things Happen When You Change Your Pricing?
One of the trickiest parts of retail is price management. There are many factors to take into consideration and those factors fluctuate all the time. Pricing has an effect on both the retailer and the customer because good things can happen when it is done correctly but not-so-good things can happen at the same time.
When costs of labor, raw material, packaging, etc. eat into profit, it makes sense to raise prices because you have to offset the cost in order to stay in business. When you can point to superiority in your product, customers appreciate the value they are getting even when they are paying a little bit more. Reducing prices to stay competitive or to clear out inventory can have a positive effect on everyone because the customer comes to you to get a bargain and you have room for incoming shipments.
A sudden huge increase in price is usually much more likely to be seen in a negative light when consumers don’t understand the reason for it. Prices that fluctuate a lot can cause a focus on the changing price rather than perceived quality just because people tend to pay attention to what catches their eye. Huge discounts can bring lots of customers and purchases without actually compensating for the true cost of changing the price tags and extra staff for the big sale. Too many sales can damage the perceived value of your business.
The Best Thing
Even not-so-good things can be profitable if you can analyze and learn from them. Since the line between the good and not-so-good things is indistinct, the best thing for price management is monitoring and controlling as many factors as possible in a consistent, transparent manner. The good news for retailers is that ChainDrive Price Management software offers the best things for doing this:
- Price transparency is consistent throughout the enterprise
- Price monitoring and analysis are completely customizable
- Security is user-defined across the entire system
- Performance metrics are updated in real time
- Campaigns can be tracked and controlled
All these and more are standard in ChainDrive Price Management but since it can be customized for specific usage, you don’t have to settle for things that don’t exactly fit your needs. You can ensure that good things happen when you change your pricing and keep the not-so-good things to a minimum.