With a meaningful market-oriented pricing strategy, over the years, many medical technology companies have managed to successfully perform on both domestic and international markets. Other practical examples confirm that this elementary determining parameter for your company’s success often not aligned with the corporate strategy and at the same time neither a full price organization nor sufficiently implemented price processes exist. To avoid such inefficiencies, we are there for you to support you in the following areas, among others: Definition of effective price strategies, international price harmonization and differentiation, implementation of discount and requirements strategies, price-building processes and pricing for product launches, professionalization of price management, creating internal and external price acceptance as well as introducing controlling processes through pricing cockpits / KPI dashboards.
Homburg & Partner‘s Pricing Excellence approach helps you achieve the price consistency in digitization necessary in times of increasing market transparency, which will lead your company to lasting growth in the medical technology market. To this end, we identify action fields on the basis of the following six dimensions:
In order to be able to implement the most successful price strategy possible, this needs to be consistent with the corporate strategy while simultaneously being compatible with the requirements and consequences of the sales strategy. Our Pricing Excellence approach defines target KPIs beyond markets, competitors and products, which take pricing and sales components into account, while also creating a framework for your price positioning without ignoring important impact factors.
Price building processes need to be defined step-by-step and continue to exist per geographical unit at least as a point of reference. This will allow you to establish a domestically and internationally transparent and clearly communicated pricing. We have best practices available in this regard for defining price structures – such as price waterfalls or geographically optimized transfer-pricing systems – thanks to many, internationally set up customer projects.
Pricing methods at the product level need to be set in the price framework and at the same time a specific mix of these methods need to be considered, since often different methods within the portfolio can lead to the greatest sales in the medical technology market. In this context we will find the optimal pricing for you with methods such as “Value Based Pricing” or portfolio pricing.
Due to the great relevance for the company’s success, price management should have well-trained competences and sufficient capacities made available to it. We therefore implement an ideal price organization for you which transfers responsibilities to your main and sub-units and makes the necessary price processes operational using suitable systems. Internal and external, professionalized communication of the new price design is of particular importance to achieve the greatest possible acceptance.
Medical tech companies often do not have the necessary experience to develop economically meaningful discount and conditions systems while considering their sales structures, and thus often favor large differences between the required gross prices and the net prices ultimately enforced. We will support you in developing a foundation for your discounts and conditions based on performance-based factors, providing a scope for decision-making and escalation processes as well as skill-building materials such as negotiation guidelines for your sales force.
Finally, we will support you in the monitoring of your KPIs which you seek to reach, by using defined pricing strategies within the provided pricing framework. We make use of the direct success measurement of the pricing and adapt your prices so that they are success-oriented, employing tried and tested controlling tools.
Homburg & Partner can look back on many years of experience in using the Pricing Excellence approach to set up your company from pricing strategy to controlling in an optimal and up-to-date manner, taking into account interfaces such as sales, increasing margin gains and efficiently exploiting sales markets.
Do you have questions or would you like to discuss the topic? Then feel free to contact our experts Dr. Michael Scholl, Karl-Hubertus Gruber and Dr. Michael Marquardt.