Energy Giant’s Global Pricing Transformed into a Well-Oiled Machine

The priorities are clear and consistent at this multinational energy company: generate cash, return it to shareholders and reinvest in the business. The company’s brands include some of the best-known passenger car engine oil and heavy-duty engine oil labels and premium lubricants throughout the world. The global process advisor for pricing and his team are responsible for setting and optimizing pricing for more than 5,000 SKUs in the company’s lubricants and additives division but it was extremely challenging to organize the many pricing variables in one place.

What was once a highly decentralized and undisciplined product pricing process several years ago has now been organized using Vendavo solutions into a high performing function that ensures agility, precision, and profitability. Because one price does not work for all customers, explains the pricing advisor.

The company also uses segmentation to build and maintain price lists that represent every customer base, in every market around the world. And the company’s sales teams are better prepared for negotiations no matter if they’re selling to customers who need hydraulic fluids, turbine oils or antifreezes.

The pricing advisor explains that he and the 700 other users throughout the company agree pricing is easier and more transparent with Vendavo. When price changes are made, the ripple effects can be seen more clearly. “Now when we make a price change, we can preview the impact on revenues and margins before its officially published,” he says. “We can run different scenarios and see if our changes achieve the desired results in topline and margin growth.”

“We’ve got to capitalize on these positive market forces and one way we do that is by making sure our pricing is as sharp as it can be,” says the pricing advisor.