Use price research and revenue management software to make your acquisition successful when it comes to pricing.
Building a Pricing Simulator for Sales People
Some tips about how to build a pricing simulator for sales people, using either Excel or cloud-based price management software.
Pricing Simulation for sales people can be highly useful in many situations. It can help assess price increases, or simulate different profitability outcomes when applying different assumptions. It can also be useful when e.g. merging companies to see what different scenarios play out well for the merged company versus the customer.
Some key criteria for deciding how to build it:
- It must be easy to use: this typically means either building a model in Excel, or using a cloud-based deal management solution such as SPS Online from Stratinis. The advantage of a cloud-based pricing tool is that it has a lot of built-in functionality for simulation, configuration and analysis, and can also integrate data from e.g. SAP ERP or send data back to operational invoicing systems once a deal has completed. But Excel models can also be useful as proof-of-concept or for simple simulations tasks.
- Scenarios: It should allow for saving different scenarios and allow for comparing those scenarios
- Visibility: it should show the sales people the complete picture of the customer engagement, including prices, discounts, off-invoice rebates and other monies paid to the customer. While an Excel file can be configured for that too, a modern-day price management software will also allow for different views that automatically can be switched on or off based on the user. This includes showing e.g. more detailed costs or corporate targets for management, but could also be the ability to generate both an internal view and an external view from the same simulation. The external view is something to potentially share with the customer, omitting confidential items, and the internal view can show profitability, floor prices, benchmarks and other KPIs.
- Data: It should not create additional work for the sales people, so it should be able to bring in data from other systems and avoid double entry or double management
- Longevity: in B2B it is good if deal scenarios can kept for months or years, so it is possible to go back and look at what was simulated previously.
Regardless if you are looking to build a model in Excel or if you are looking for something that is ready-made and more robust, such as SPS Online, we can help you.