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The purpose of this paper is to point out that most pricing organizations are not forward looking, rather they are focused on outdated price points and reviewing past negotiations. For the greatest return, pricing organizations must be strategic, and this will boost returns from 1-2 per cent (which may represent the “Hawthorne Effect”) to 5-10+% revenue growth.

The author examines best practices in the airline, hi-tech, software, chemical, diagnostic testing and manufacturing industries. Case studies show that sales and other line organizations are highly adept at subverting pricing rules not compatible with market dynamics.

Pricing organizations must be designed with broader scope of influence and situated so as to work closely with other functions. Pricing organizations require “analytic horsepower” to correctly anticipate the market, and be credible within company. The head of pricing must be sufficiently senior (VP or SVP) to be part of top-management dialogues for sufficient results.

This paper is based on examination of 20+ industries only.

The author offers guidance on organizational structure, resources and return on building a world-class pricing function, and highlights common mis-steps and best practices.

The paper also details the differences between a narrow “transactional” approval function and a strategic market-oriented function. Social implication is moving from focus on increasing price level to increasing revenues and better price structures which address needs.

This paper offers a new perspective on pricing functions within companies. Most managers are not aware that pricing organizations are focused on the past. The papers’ value is to shift management focus to future pricing challenges, new structures, price points, discounting rules and competitors.

When it comes to battling new competitors and protecting their margins, large, established companies tend to use the same arsenal of strategies. They cut costs, introduce new products, diversify their offerings, and accelerate their speed to market. But all too often, corporate strategists overlook one of their best weapons: improved pricing strategies.

For many companies, raising prices can result in customer defections and reduced volumes. The right strategy for increasing prices can result in increased customer satisfaction and fewer defections. Several approaches for raising prices involve changing the customer value proposition at the same time as changing the price. This makes it harder for customers to identify the changes and they are less likely to react. Finally, a close examination of lifecycle patterns in customer usage allows companies to structure their prices so that customers “grow” into a price increase over time.

Based on the evidence, brand must be one of the biggest guns in the corporate arsenal and thus worthy of significant investment. After all, consumer product companies regularly spend hundreds of millions of dollars to support brands; Wall Street values leading Internet businesses at enormous multiples simply because of their online brand strength; and CEOs surveyed by Ernst & Young judge brand to be among the most important keys to their companies' future success.

While the US economy seems to be in an upswing, there is still plenty of downside for some companies. But a downturn need not be seen as a giant sucking sound, eliminating all of a company’s pricing power. Through astute use of strategies such as the ones discussed in this article, many companies can continue to raise prices. The authors discuss such pricing strategies as working around budgets, using tools other than list price to cut price, bundling and tiering goods and services, and locking in your best customers.

Much attention has been paid to the pricing of goods, but services now constitute almost half of the US economy and they have their own pricing requirements. Services differ from goods in that the choice of pricing structure is more fluid, as for example in determining the unit of charging. In addition, services tend to be more variable in quality because they are impacted by unique customer needs and environment. Thus, a framework for taking into account quality differences (risks) is integral to the price structure.

Providing customers with value is often not enough for a company to operate profitably. While ensuring that a product or service offers value to users and customers, there must be a conscious plan to capture a portion of that value. This is called monetization (turning value into money) and is often sudden and destructive of value, as when managers employ short‐term tactics to meet a budget shortfall. Smarter monetization strategies include ways of voluntarily extracting value though brand management or creating a market for liquidating inventories. This will allow managers to meet budgets without compromising company value.

1 January 1992 is the date that The Library Charges (England and Wales) Regulations come into force and bring the philosophy of the free market into the public library world for the first time. Library authorities will be able to make a charge for, amongst other things, “assisting or instructing a person how to use a computer”, “for providing a room or cubicle on library premises for the purpose of working or studying…” and “for researching and for collating information for and at the request of a person”. Not only that but “the amount and the incidence of any charge made…shall be at the discretion of the relevant authority”. But you will doubtless be relieved to know that basic lending and reference provision will continue to be free in the old‐fashioned sense of the word.

The US restaurant industry and the food‐service industry have undergone tremendous changes during the last decade owing to demographic changes, changes in the family structure, the increase in the number of working women and senior citizens, advances in technology (inventory management, customer order processing, accounting/financial systems, etc.), availability of financing, changes in the real estate industry (location, negotiation with malls, relationships with developers, etc.), intense competition, the growth in the types and number of marketing channels (including the Internet), increasing number of drive‐through customers, employee training requirements, changes in labor laws, the rate of implementation of technology, changes in food sourcing/purchasing, the growth of the franchising business model, and increasing regulation. These factors have combined to shape the strategic, legal, economic and operational considerations that executives and decision makers should thoroughly understand. This article discusses the issues and challenges facing one company in these two industries and how management and banks have reacted, and then explains strategies for the future. Also discussed are relevant considerations for financial sponsors and companies. Most data and analysis are as of April 2000.