Price is The Key Driver of Profitability
Price Key Driver of Profitability
Price has the most immediate impact on top- and bottom-line growth. In fact, research has shown that a 1.0% increase in price leads to a 11.0% increase in profits (ceteris paribus). With consumers average price recall errors ranging from 6% – 20%, arguably price is one of the most effective levers to pull when trying to grow the profitability of your business.
This means small positive or negative price variations can have a big impact on firm performance. That is why it’s crucial for firms to invest in the development of world class pricing capabilities that will help them weather the storm during economic downturns and ride the wave in periods of economic growth.
Author
Pim is the co-founder of RGM Consulting and a core member of the global executive leadership team. In the leadership team he oversees: sales, research & knowledge development, marketing, and delivery.
Pim has extensive experience supporting leaderships teams across the globe, having worked on projects in Europe, Latin America, and Africa. Through his work, Pim has developed expertise in revenue growth management, business turnarounds, innovation management and marketing. Furthermore, he has deep expertise in the consumer goods industry.
Expertise
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- Revenue Growth Management
- Business Strategy & Transformation
- Business Turnaround
- Innovation Management
Education
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- Master of Philosopy in Business Research (graduated cum laude)
- Master in Business Administration (graduated cum laude)
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