Discrete Manufacturing Industry Overview

DM01 - Efficient and optimized List Price (re)calculation based on pricing strategies

DM02 - Automatic recalculation of dependent Price Lists e.g. region, country, different sales channel

DM03 - Ensure (Net/List) Prices are aligned across a region (Price corridor)

DM04 - Design and deploy new pricing strategies using visual drag-and-drop “no code” configuration (Strategy Designer)

DM05 - Proactively and efficiently set a price for a new product

DM06 - Proactively and efficiently set a price for updated product (Cost / Competitor price or other changes trigger repricing)

DM07 - Leverage price guidance when quoting

DM08 - Define standard discounts & surcharges

DM09 - Customer-specific Discounts

There are several pricing strategies that discrete manufacturers can use to optimize their pricing and improve their profitability. Some common strategies include:

• Cost-plus pricing: This strategy involves adding a markup to the cost of producing a product to determine the selling price.

• Value-based pricing: This strategy focuses on the value that a product provides to the customer, rather than just the cost of producing it. Manufacturers using this strategy may charge higher prices for products that provide more value to customers.

• Dynamic pricing: This strategy involves adjusting prices in real-time based on changes in market conditions, demand, or other factors.

• Penetration pricing: This strategy involves setting low prices initially to gain market share and increase sales volume.

• Price skimming: This strategy involves setting high prices initially for new or innovative products to maximize profits before competitors enter the market.

• Bundling: This strategy involves offering multiple products or services together at a discounted price, which can encourage customers to purchase more.

• Promotional pricing: This strategy involves offering temporary discounts or promotions to stimulate demand and increase sales.

The most effective pricing strategy will depend on a range of factors, including the company's goals, market conditions, and customer preferences.

The transaction mechanics for pricing in the discrete manufacturing industry typically involve several steps and a few stand out in terms of how Pricefx can assist in the process:

• Price Setting: setting the price for the product or products based on the cost to produce, market demand, competition, and other factors.

• Quotation: provide a quotation to the customer that includes the price of the product or products, along with any applicable discounts, taxes, and other fees.

• Negotiation: guided negotiation to sell at a better price or other favorable terms.

• Invoicing and Payment: issue an invoice based on the terms specified in the purchase order.

These transaction mechanics can vary depending on the specific products being manufactured and the terms agreed upon by the manufacturer and customer. In some cases, manufacturers may use dynamic pricing strategies that allow them to adjust prices in real-time based on market conditions or other factors.

The following are the common models used in this industry:

• Direct sales – typically handled by field sales personnel with buyers.  In some cases, inside sales personnel will cover smaller accounts that are judged to be too large to give to distributors.  Rebates are commonplace and generally are focused on the direct customer.   

• Distribution sales – through an assortment of multinational, national, and regional distributors. Annual rebates, usually on a volume basis, are typical for producers to drive sales through distribution.  Manufacturing companies will frequently utilize distributors to manage their “long-tail” customers who are too small to serve directly.  

• Value-Added Reseller (VAR): - typically to a VAR who then adds value to the product by customizing it or bundling it with other products or services.

• Original Equipment Manufacturer (OEM) - through components or sub-assemblies to other manufacturers, who then incorporate them into their own products.

Marketing plans in the discrete manufacturing industry involve various strategies to reach target customers and promote products. These include trade shows, content marketing, SEO, ABM, customer referrals, direct mail, and sales promotion. The specific plan depends on the manufacturer's goals, target customers, and available resources.

Aftermarket products and services are necessary for the maintenance, repair, and operation of products in the discrete manufacturing industry. These include spare parts, maintenance, repair, upgrades, training, and warranty services. They help build customer loyalty and generate recurring revenue streams for manufacturers.

DM 10 - Setup a new agreement or review an existing one for next year

DM 11 - Calculate and process accruals and payouts

DM12 - Optimize prices for deal guidance

DM 13 - Identify and eliminate underperformance

DM14 - Compare company pricing and deal performance using benchmark data (Plasma)