“We’re the dumbest business people in the world. We post our prices in two foot high numbers atop 20 foot high posts.” said the executive of a local oil distributor who owned and operated a number of service stations.
He’s right! Can you imagine a better way to focus your customers’ attention on price? So how should you go about communicating your price increases?Read More
Economists tell us that wealth is created when it takes fewer labor hours to acquire the things we want. Does that mean that we should be passing along our savings to customers in the way of lower prices?Read More
I’m regularly regaled with stories of pricing games played in large organizations, many are Fortune 1000 companies, that cost them business. Yet the games persist. Here are a few examples to help you avoid these pitfalls.Read More
The following quote appeared in an Andrew Frye and Dakin Campbell, February 17, 2011 Bloomberg article ‘Buffett Says Pricing Power More Important Than Good Management.’
“The single most important decision in evaluating a business is pricing power,” Buffett told the Financial Crisis Inquiry Commission in an interview released by the panel last week. “If you’ve got the power to raise prices without losing business to a competitor, you’ve got a very good business. And if you have to have a prayer session before raising the price by 10 percent, then you’ve got a terrible business.”
The article does go on to congratulate some excellent managers and criticize others. Despite the title of the article, Buffet does look at both pricing power and management. So what is pricing power and how do you get it?Read More
I recently had a truly unusual, memorable experience facilitating a discussion about pricing. What made it unusual? There wasn’t one question about pricing. Yet every person there described their ‘problem’ as a pricing problem. What were the real issues?Read More