Price Management for Industrial Goods

Hermann Simon and Martin Fassnacht
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Hermann Simon: Simon-Kucher & Partners Strategy and Marketing Consultants
Martin Fassnacht: WHU – Otto Beisheim School of Management, Chair of Marketing and Commerce

Chapter 11 in Price Management, 2019, pp 417-442 from Springer

Abstract: Abstract Price management for industrial goods involves numerous special aspects. Overall, it is characterized by a wide variety of price models and pricing approaches. Because of these special aspects, analysis demands a thorough understanding of the specific case. That includes the role of individual people as well as groups, the so-called buying centers. Many industrial suppliers see themselves up against “derived demand” which has consequences for price management. For the price decision, very different processes come into play. Depending on the project, these can be driven more by value-to-customer, which is often quantifiable for industrial goods, or more by costs. Auctions play an important, and thanks to the Internet, growing role. Important aspects of implementation are skills and savvy in the protracted and tedious price negotiations and the contractual hedging of price risks.

Date: 2019
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DOI: 10.1007/978-3-319-99456-7_11

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