The price point

24.07.2006

Montgomery says many people distrust these kinds of systems because it can be hard to understand how they work. "They are very complicated, and if you go in and try to wow them with the science, you'll lose them," he says.

He advises getting the technical and financial people on board first and then using that support to reach out to others in the company.

Todd Mueller, market planning and analytics manager at J&L Industrial Supply in Southfield, Mich., says a new price-analysis tool enables J&L to understand past pricing and its effects as never before. And it puts that capability in the hands of end users for the first time. No longer do users have to ask IT to create some special report and then wait two days to find out it was not what was really needed, Mueller says.

Now, with Vision from Metreo Inc. in Palo Alto, sales managers can run through "three or four iterations in 20 minutes," he says. "It takes our historical pricing data - on a transaction line-item detail level -- and lets us slice it and dice it on every imaginable attribute. I can look at customers by margin, by sales, by number of items purchased, by geography and so on." Some 200 such attributes can be called out, he says.

The Vision tool allows J&L to understand how the market is behaving, Mueller explains. "You can then see where pricing is not being set correctly and go fix it," he says.