Ariel Banos, expert in pricing strategy, presents in this article a key aspect to consider when quoting proposals for professional services.
"... In his book "Pricing Creativity", Blair Enns exemplifies the big differences there can be in the price of professional work, using the cases of some famous logos.
Unlike historical analytics, predictive supply chain analytics allows you to anticipate and prepare for the future, taking out the conjectures planning processes and improving decision making.
Predictive supply chain analytics use advanced technological tools such as machine learning, geomarketing, data mining that enables organizations to identify hidden patterns, understand market trends, identify demand, establish pricing strategies, achieve a high return on investment, optimize and reduce inventory costs.
If the products and services sold include aspects that are highly valued by customers and our prices have evolved below market rates, it means that it is feasible to raise marketing prices.
Ariel Banos, founder of Fijaciondeprecios.com, describes the signs that should be analyzed by businessmen at the moment of applying an increase in the prices of the products and services marketed.
Fifteen months after the beginning of the health and economic crisis, Guatemala, Honduras and Nicaragua are the economies in the region with the highest inflation rates, a behavior that was influenced by increases in fuel and transportation costs.
In the second quarter of 2020, a period in which the countries of the region were going through a severe economic crisis caused by the Covid-19 outbreak, inflation levels were low and in some economies negative variations were reported.
Between December 2020 and May 2021, the average cost of airline tickets in Costa Rica increased 18%, a variation that is explained by the increase in fuel prices and the depreciation of the local currency.
One of the sectors with the highest contribution to the variation of the Consumer Price Index (CPI) in May was Transportation. According to the National Institute of Statistics and Census (INEC), gasoline, airline tickets and tourist packages abroad were among the main items with the greatest positive effect on the price level.
Generating a trusting conversation with clients and identifying and presenting your own success stories is of utmost importance so that at the quotation stage a price is defined based on the value provided by the products and services.
According to Ariel Banos, founder of Fijaciondeprecios.com, exploring the method of defining prices based on the value for the client is a recommendable resource for those who hesitate about how much to charge their clients.
Deploying all the analysis capacity to identify and value the differentials of the proposals, so that the customer is aware of the additional value of the products or services they will buy, is key to sell at higher prices.
Ariel Baños, founder of Fijaciondeprecios.com, exemplifies one of the cases in which strategies to sell at higher prices can be applied and explains the factors that influence this type of scenarios.
In Costa Rica, since July 2020 the producer price index for the manufacturing sector started to report increases, a situation that could lead to a rise in sales prices and simultaneously to a fall in the quantity of products traded.
Between December 2019 and June 2020, the producer price index for the manufacturing sector (IPP-MAN) reported negative year-on-year variations. This phenomenon was reported in the context of the onset of the health crisis caused by the Covid-19 outbreak.
The oversupply of office space and changes in the dynamics and ways of working of companies have led the office rental market to a corrective or adjustment phase, which is mainly evidenced by the downward pressure on rental prices.
At the beginning of 2021, CentralAmericaData expected that in the coming years, 4 out of 5 companies will bet on hybrid work modalities, which include face-to-face and remote activities. This phenomenon will force office supply to adjust to the new market conditions.
"The cost determines my selling price" and "let's lower prices to win customers and then start raising them" are some of the phrases that should be avoided when designing a pricing strategy.
Ariel Banos, founder of Fijaciondeprecios.com, has identified five phrases that are dangerous and that companies should avoid applying when designing their price management strategy.
Taking advantage of shortages to sell at high prices and visualizing the benefits to companies of strategies that demonstrate social empathy in difficult times are some of the lessons learned during 2020, which was highlighted by the health and economic crisis.
The spread of covid-19 suddenly transformed the global business landscape. Ariel Banos, founder of Fijaciondeprecios.com, has identified five lessons that companies learned in terms of price management, in this context of changing commercial reality.
Since 2018, the price of the banana box that Costa Rican producers sell to the German supermarket chain ALDI is falling, there is concern that other European chains will begin to negotiate lower prices.
Representatives of the National Banana Corporation of Costa Rica (Corbana) explained that in 2018 the 18.14 kilo banana box sold to ALDI was quoted at 13.55 Euros. However, in 2019 and 2020 the amount paid for the fruit was reduced, and by 2021 a price of 11.33 euros has been set, which is equivalent to a -16% variation with respect to what was charged in 2018.
Selecting products with limited sales potential because of price, defining the group of clients that will be reached by the promotion and quantifying the profits that the company will receive after offering discounts are factors that must be evaluated when applying strategies of this type.
In order to avoid carrying out promotions in an intuitive way, without an integral evaluation of the action, both in terms of costs and benefits, Ariel Banos, founder of Fijaciondeprecios.com, proposes seven steps to correctly define a Profitable Promotion.
Due to the economic crisis generated by the covid-19 outbreak, it is estimated that between 10% and 12% of students in private institutions in Costa Rica have stopped demanding the services, and tuition fees have gone down.
When the first cases were detected in the country in March, the authorities began to decree restrictions on mobility and productive activities, a situation that generated a severe economic crisis.
In September, price increases were more pronounced for vegetable oils and cereals, and for dairy products prices remained stable, while sugar and meat prices fell from their August levels.
The United Nations Food and Agriculture Organization (FAO) reported that in September 2020 the food price index averaged 97.9 points, i.e., 2% more than in August and already 4.6% above its value a year ago.
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