Optimized Pricing Integrated with Salesforce Boosts Gross Margin by 238 Basis Points, Increased Win Rates & Drives 5% Revenue Growth

With a history spanning more than one hundred years, this company is a major global player in the production of diversified consumer packaging, industrial products, protective packaging, and packaging supply chain services.  They are the world’s largest producer of composite cans, tubes, and cores.

Employing over 22,000 people in 33 countries, the company runs sustainability initiatives that recycle 3 million tons of paper, metals, old corrugated containers, and plastics each year.

This company serves a large and diverse customer base in the consumer package goods industry.  Where flexibility and customer-centricity has been an asset, it comes with pricing challenges.  These challenges center around the thousands of customers, each with unique needs, resulting in extreme complexity from custom configured ordering.

Sales had a legacy of using an overly-complex system and tools where prices still required manual calculation. This created a large amount of work and with it the potential for human error.

There was no standard pricing, and dated MS Excel spreadsheets offered no price guidance.  As a result, opportunities for margin uplift were being missed.

Sales processes also relied on manual reviews. Quotes frequently required manual intervention and turn times were unacceptably high.

Starting with a single business unit in 2018, the company embarked on a multi-year digital-transformation journey with Pricefx to overcome the limitations and inefficiencies of their existing system and to streamline operations.

The desired end result was a single enterprise-wide pricing platform to provide intelligent optimized sales guidance for complex configured products in a complex IT environment.

Objectives:

• Implement a comprehensive price management solution to support back-office teams and sellers with quick and error-free optimized quoting.

• Consolidate five different pricing platform solutions into one unified system, standardizing with Salesforce CRM and Oracle Cloud ERP.

Pricefx Capabilities:

• Price Setting supports list price management and establishes clear and impactful price policy definitions and guidelines. This provides foundational pricing tools, strategies, and processes for complex configured pricing (e.g. packaging dimensions, shapes, materials, treatments, and other configuration attributes).
• AI Optimization generates sales guidance models which are executed in CPQ tools via prescriptive floor, target, and ceiling pricing guardrails.
• Quoting allows sellers to quickly and accurately respond to bid/price requests including integration with Salesforce CRM (replacing Microsoft Dynamics CRM).
• Analytics identifies outliers, sources of margin leakage, and provides customer profitability assessments.

Within one year of implementing Pricefx, the company realized significant improvement in key business metrics:

• Margin Improvement: Implementation of AI Optimization along with sales execution via Salesforce CRM integration boosted gross margin by 238 basis points and increased revenue by 5%.  This financial uplift was not just a one-time event; it was sustained over the following years, with gross margin stabilizing and even showing continued growth.

• Streamlined Sales: Quote request turnaround time decreased by 1 week, resulting in increased overall win rates.  Improved sales processes captured an estimated $1.3M in additional sales per week.

• Operational Efficiency: The ability to swiftly address cost increases minimized margin leakage, allowing pricing analysts to focus on strategic initiatives.  Automated approvals eliminated manual intervention in 85% of quotes.