Your Priority should be Profitable Growth not Higher Prices

Posted by Moira McCormick on August 10, 2016
Moira McCormick

Do you have a conflict in your business between the pricing team and sales department? Certain members of your sales team probably think that all your pricing manager cares about is higher prices – which can make it more difficult for some in sales to close deals. However, B2B pricing professionals should counteract this assumption by emphasising the importance of profitable growth, not just higher prices – and they should make sure that this priority is effectively communicated to the sales team. Everyone involved with the sales process should be concentrating on profitable growth rather than higher prices every day of the week as this will keep you all aligned to the overall goals of the company – and keep you in business long after the opposition has faltered. "Profitable Growth" should become your mantra!


How do you demonstrate your commitment to profitable growth?

  • Make it clear that you are not just about raising prices by publishing a mission statement explicitly stating your commitment to profitable growth. Don't make it an essay but do make your aims clear – make a poster out of it if you think that will work.

  • When you lower prices rather than raising them, make sure you emphasise/advertise this fact to your sales team. When those decisions generate profitable growth, remember to draw attention to this favourable result.

  • There will of course be times when you've advocated higher prices. Make sure that on those occasions you've communicated your reasoning to all concerned and shared your calculations with the sales team so they understand your reasons. Just don't do it all the time!


How is profitable growth achieved?

Focus on Customer Loyalty

Customer loyalty is vital for both growth and profit. It enables growth by providing a larger and more stable customer base and it generates more profit because loyal customers cost less and spend more. A profitable growth can only result from a strategy that creates loyal customers.

Focus on customers’ needs by delivering highly perceived quality products at a competitive price, within the shortest possible timescale, and with an excellent customer service. By deciding to be a hit with customers and by focusing on the creation of value, you will be able to succeed against your competitors. Creating and delivering value for customers is the source of high customer satisfaction and loyalty that in return leads to growth – just keeping 10% more customers per year can double the number of your customers in seven years (and triple it in ten years), and lead to excellent profit growth.


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Unless you show your customers what makes you different, there is little reason for them to buy from you. The key is to find the appeal that can set you apart from your competition in a unique way.

Some ideas to make you stand out include:



If you produce something physical, you may be able to differentiate based on a unique design aspect. The general rule is that if you don't invest to improve your competitive position, you will lose that position over time. You need to make the design of your products attractive to stand out from other competitors. Remember, increasing competitive advantage leads to profitable growth.



Specialized knowledge, for example, is something concrete you can point to, as is specific experience within your workforce. Recognized business or industry proficiency can also be highlighted to demonstrate how your company and people are different from your competitors. The key here is to ensure the recognition moves beyond the individuals involved and is leveraged to the benefit of the company as a whole. Your business will need strong research, development and design thinking to create innovative new ideas, including delivering high quality to customers – so, if necessary, invest in training for your existing workforce and when it comes to employing new staff, look for innovative types.




Technical Expertise

This one refers to domain knowledge, not necessarily technology (although that too can be a differentiator under the right circumstances). It may, for example speak to the ability to address a specific concern or a deep-seated knowledge around a set of rules and regulations. The breadth of expertise is just as important as the depth, as it will define the market you go after.



Creating profits is the key to driving growth in business. If you consistently focus on profitable growth - not just higher prices - you’ll have a better chance of maintaining a positive relationship with your sales department. That means that there will be a much better chance that they will follow your pricing recommendations when they are preparing quotes in the field.

Even more importantly, keeping your focus on profitable growth will make it possible for the pricing team to uncover new opportunities for driving margins and growth. In the end, that will inevitably mean more success for you and your company – and you might just discover that growth creates more growth.


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Topics: Price Optimisation, Profit Maximization

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