Welcome to the Business Intelligence of Ibic Srl
Simulation of Price Derivation Algorithms
Project:
A multinational company, leader in the optical and visual health market, aims to position its products competitively and strategically on a global level, while ensuring price uniformity across countries.
The price list generation process required tools capable of simulating prices, analysing their positioning in the market, comparing sales data and characteristics of similar products or products in the same price range.
As SAP Vistex did not provide simulation functionality, the Pricing team relied on reports and exports in Excel, but data management was complex and difficult to maintain due to the amount of information coming from different systems.
We created a Datamart that collects data from different sources (Vistex, price lists, sales, product master data) and developed a dashboard in Qlik, which allows real-time analysis and simulations via What-If Analysis.
In the dashboard, a ‘pyramid’ visualisation was created to intuitively represent two key concepts: the price range and the price derivation process. The main parameters influencing the transition from product cost, to price range to shop and finally to final retail price were illustrated. The metrics included are: Commercial Buffer, Trade Multiple, Duties, Logistic Cost and Currency.
Simulations allow these derived parameters, as well as the base price or derived price, to be modified to explore new positioning scenarios and compare changes from the current price.
Results:
By logging into the dashboard, final users can monitor price trends by range and create simulations with different parameters and markets, defining new scenarios to optimise the pricing strategy.
