When it comes to Strategic Pricing®, it is not your strategic choices that make you successful. It is how thoroughly you incorporate them into your proposal pricing and how well you implement them that matters. Remember, many organizations paper their walls or line their bookshelves with strategic paper. Most do not rip them off the walls and make them part of their fabric.
Strategic Pricing® Choices
Too many organizations think they address Strategic Pricing® when they prepare a bid. What they tend to focus on is just the overall price rather than the intricacies that compose the price both individually and how they integrate their choices into Strategic Pricing® from the technical solution. Some companies only focus on the lowest price. When you sell only price you have chosen to do commodity pricing. You will always sell on price. Get away from making price the determining factor. Add value whenever you can and demonstrate that value in your Strategic Pricing® in your visuals and compelling statement in the business proposal. That means avoiding pursuing projects that are not strategically price developed. Compose your price with your overall business goals in mind.
Strategic Pricing® and Marginalizing
People often ask if they should bid the lowest margin they can and even buy into a project. The simple answer is NO unless that is all that you want – to always sell on bargain basement pricing. Find out what is profitable for each project and do what is profitable repeatedly in your business. That means doing an analysis of what your costs are and tossing out what is not going to make you money. That means, do not bid on projects that will not make you a decent profit margin, are losing opportunities, or have enormous risk to your business. In the end, the Government wants you to make a profit to remain a viable business and continue to be a source of goods and services.
For more on this topic see https://blog.blackcurve.com/the-beginners-guide-to-implementing-strategic-pricing
