Auto Parts and Services Provider Optimizes Omnichannel Pricing and Eliminates Margin Leakage

With operations throughout Europe, a leading auto parts and services provider was facing growing omnichannel pricing challenges. In pursuit of its mission, the business wanted to equip central and local teams with the right solution to eliminate margin erosion and increase profitability. The company implemented Pricemoov’s next-generation pricing platform to better manage and optimize its prices across multiple channels. 

Insufficient Data and Resources to Price with Agility

The company lacked a central environment to keep track of pricing-related data. It used five different ERPs spread across 15+ countries that were not integrated. As pricing decisions were made using spreadsheets and other non-pricing-specific tools, teams involved in pricing spent a lot of time resolving data conflicts and data quality was a growing concern. 

Reacting to competitor movements was another challenge. The pricing team had to monitor competitive data and manually change prices in spreadsheets. “Imagine having 1 million auto parts with neither specific rules to manage prices at the SKU level nor the manpower to cross reference with the catalog. We were only able to update prices for the top performing 100 products with no means of ensuring the accuracy of the remaining SKUs,” explains the pricing director.

An added layer of complexity was the ongoing change in market dynamics with different levels of inflation and cost volatility in each country. The company was grappling with frequently changing costs due to scarce raw materials, port disruptions, and labor constraints. Not having the necessary manpower meant the pricing team lacked agility in changing prices to protect margins. 

Lacking Control Over Sales Negotiated Prices

For its B2B business – about 70% of the company’s revenue – the pricing team and category managers provided the sales teams with price guidelines once a year in a PDF file. As the format was not user-friendly, sales reps did not refer to the document. 

Moreover, as customer relationships were managed by the local teams, salespeople had autonomy to set prices as they saw fit. Customers could request one-off discounts and sales reps could implement them with limited to no approval. There was no way to enforce price guidelines and the pricing team could only conduct ad hoc checks in hindsight. 

“Our salespeople were more focused on growing volumes than protecting margins,” the pricing director recalls. “The result was shrinking margins per unit and decreasing profitability. We needed to adopt a more rationalized, data-driven pricing approach that would enable our sales teams to propose the right prices to every customer.” 

Pricing as a Strategic Priority to Drive Profitability

A turning point came with a new CEO who prioritized pricing as a key lever to address wavering profitability. The company needed a solution that could handle a complex B2C catalog, with the capability to support different pricing strategies and optimize prices dynamically. 

At the same time, the B2B side of the business required guideline-setting functionality and real-time monitoring via dashboards. Moreover, the solution had to be user-friendly and integrate with the CRM system, so that sales reps could create quotes quickly and accurately. 

Upon evaluating various options, the company selected Pricemoov as the most suitable provider to support every stage of its pricing transformation. “Not only were we impressed by Pricemoov’s platform capabilities, but also its subject matter expertise. Pricemoov experts understood our pricing challenges, what we wanted to achieve and advised us on the best solution to reach our revenue objectives,” comments the pricing director.