As a pricing professional, I always love to quote the study that a 1% improvement in price leads to 11% in operating profit, whereas a 1% increase in volume sold improves only by 3.3%[1]. If the business case for managing and improving price is so apparent, why don’t more companies do it? There are multiple factors why a price improvement… Read More

Pricing impact on profitability

  In a recent HBR article, “Linear Thinking in a Non-Linear World,” the authors explain how our minds are naturally biased to assume every relationship between two variables is linear. We are trained to think that the impact on Y with a change in x will be in a fixed/constant proportion. Often, this is not the case and can lead… Read More