Winning contracts is essential to the success of any business. In order to win, you need to offer the best value solution to your customers. This is where price-to-win comes in. This process helps you analyze your competitors and determine how they are likely to position their solutions, as well as what bid price they will offer. In this comprehensive guide, we will discuss how to best employ price-to-win strategies for your business!
The earlier you can engage with price-to-win, the better. It is an important factor to consider when developing your best value solution and winning the bid. Keep in mind that this will affect the type of bid you enter and that it is a continuous process.
Find and Use the Right Tools
The use of information systems and analysis tools is a must for any company looking to conduct price-to-win. This includes customer relationship management (CRM) systems, as well internal knowledge bases that can be used specifically within your organization’s needs. Custom-built spreadsheets with functionality-specific functions such as budget tracking or market intelligence gathering could also come into play. Market intelligence reporting and gathering tools are currently available from INPUT/GovWin/Deltek and E-Pipeline. The budget tracking tool widely used is Fedspending.org.
Gather Customer Intelligence
Obtaining customer intelligence is essential in the price-to-win process. This can be done through presentations or meetings with clients to understand their needs better. Obtaining an independent cost estimate is key to knowing what a customer is willing to pay for the project. Information gathered can be integrated into the CRM system to track progress and make that information available to the team pursuing the opportunity.
Gain Competitor Intelligence
The goal of a competitive analysis is to gain as much information about your competitors so you can create a better offer. One way that this works, is through knowledge bases and supporting techniques obtained within ethical guidelines.
A good place for starting would be looking at what other companies have done in similar situations before because it will give insight into their pricing strategies which may provide some guidance. Competitive intelligence also includes commercially available knowledge management tools and supporting techniques. Price your competitors’ likely solutions and adjust for possible changes.
Other Factors to Consider
Your cost data, competitive position, pricing differentiators and internal risk are some factors to be considered when making your price-to-win. Gather information from your previous bids, your market position and identify your performance risks as these are factors that will affect your bottom line.
Align Sales and Pricing
Maximise what you offer at the price you provide. Show the way you offer value and benefits to the customers. Work with the sales time and determine the ideal solution for your customer. Are they willing to go for more features? Align your solution to their needs.
The process of getting to a price-to-win target range starts early in the procurement cycle and continues throughout its life. Information about one’s own organization, as well as what they are competing against from other companies can help you determine the correct price-to-win. Ultimately, the winning price must offer value to the customer.