Yesterday (July 22, 2013), the Wall Street Journal published an article titled “How Companies Can Get Smart About Raising Prices.” An excerpt:
Raise prices in the middle of a sluggish economy, and they risk alienating customers they can’t afford to lose and leave themselves vulnerable to competitors.
Yet they have little choice but to ratchet up. The cost of making consumer goods and getting them to stores has been rising for some time. And a lot of the old strategies for shaving overhead, such as outsourcing, are getting less effective in economic terms and more unpopular in humanitarian terms.
The article offers advice on methods to (successfully) raise prices, and has a couple of notable graphics.
While I don’t necessarily agree with any or all of what is said in the article, I think that the article’s topic is valuable, as is awareness and discussion of these issues.
As with any discussion of pricing and pricing strategy, I strongly believe that such pricing issues need to analyzed and handled on a company-specific level, as each company almost certainly will have company- and industry-specific characteristics and dynamics that need to be considered. As such, following generalized advice concerning pricing will likely be suboptimal, if not harmful.
StratX, LLC (stratxllc.com) is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.