Increased Profit Margin in the Spare Parts Business Through Price Management

The German mechanical engineering sector is growing predominantly in the service business. WALDRICH COBURG has recognized this relevant key success factor and has expanded its spare parts business through a systematic price management strategy. UNITY led this project to success, from conception to worldwide implementation. In the conceptual phase, a global, marketdriven pricing model was developed and the price management process was defined. WALDRICH COBURG also benefited from the fact that the interchange between the relevant departments was fostered. At the same time, transparency was created regarding the relevant levers for improving the spare parts margin. The jointly developed governance model has enabled the internationally operating organization to introduce and continuously adapt the new pricing system. During the implementation phase, the IT systems were optimized together with the IT department of WALDRICH COBURG. Product and price data were adjusted so that the new pricing model could be implemented in all related processes, e.g., in the preparation of quotations. With this process, functions were also established to drive forward the digitalization of pricing. The expert support in communicating with customers enabled WALDRICH COBURG to further develop its internal organization to provide a better customer experience. Finally, the new price management model was systematically rolled out globally. By measuring defined key performance indicators, the management team has always had clear transparency about the effect of the pricing measures. Just a few months into the program, WALDRICH COBURG recorded a significant margin increase of 10 % in its spare parts business.