​Managing your company's discounting starts by having the proper level of visibility into how pricing decisions are made in the field and how discounts are evaluated and approved by sales managers.  Despite established discounting and deal approval processes in place, many organizations struggle to gain control of price variability leading to substantial inconsistencies in deal and customer profitability.  The ability to focus on improving the root causes of discounting practices by increasing visibility and control can deliver substantial economic gains to many organizations. 

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• What To Expect
• Case Study

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Objectives

Outcomes

• Identify key reasons for discounting
• Analyze the economic impact of discounting
• Identify specific opportunties to reduce discounting across products and customers
• Develop an action plan to address discounting 

• Greater control and options offered to the field organization to reduce their need to discount
• Clear understanding and implementation of valid reasons for discounting 
  
• Plan for addressing discounting via pricing discipline, improved visibility, and enhanced approval process
• Ability for on-going measurement of discounting to drive greater visibility and accountability

ROI

Watch Outs

• The impact of a well executed discount management program can be very significant.  We have seen returns on investment ranging from 10x - 20x. 
• Margin improvements typically occur as a result of discount reductions and greater price alignment across products and customers

• Making changes is never easy.  Expect both internal and external pushback 
• You will encounter a valid reason behind every discounting decision, therefore you must be prepared with solid analysis to demonstrate that there is a better way
• Learn and leverage from the best reps who have learned not to rely on discounting to get a piece of business.  
  
• Instill best practices and demonstrating impact

$6 Billion Dollar Heavy Duty Truck Manufacturer 

Challenge	Solution	Result
Significant price variability driven by uncontrolled discounting throughout dealer network Limited visibility into valid reasons for discounting  Limited understanding of their negotiating position with prospects  Inability to sell compare "apples to apples" offering vs. the competition Struggled to communicate value in a consistent and credible way​.	Created a new framework for evaluating deals based on: Knowing the deal Positioning right  Selling on Value Established 6 valid reasons for discounting and established thresholds for each reason based on deal parameters Developed new tools to manage discount requests centrally and implement a more robust deal escalation process	As a results of having greater visibility and control of over discount requests the organization was able to reduce discounts by 2.1% over the course of a 6 month pilot.  The success of the pilot lead to investments into more robust tools, training and the roll out of this process internationally.   ​.

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