Pricing analysis in the Soft Drinks market
Our client operates within a major sub category of Soft Drinks. This is a highly competitive area with a huge amount of promotional activity. A combination of varying price marks and bonuses had been used over the past two years to stimulate both wholesalers and retailers to trial and then repeat purchase. In this fog of activity, it was not clear what was working and what wasn’t!
The Whole Sale Company analysed volume and value by week for all key SKU’s and then overlaid the company’s promotional activity/ price marks/ in depot work. This clearly demonstrated the “sweet spot” where the volume was maximised against the sales value. This was then translated into the optimum selling price. Perhaps surprisingly this was not the lowest possible price as we demonstrated that once past a certain price volume was little impacted.
The sales team showed the work to a leading wholesaler who has implemented the results with sales now up 15%, with consistent pricing and more margin!