How to Conduct a Price Audit

For businesses within the retail sector it is important to conduct a fair and impartial price audit at regular intervals in order to ensure pricing strategies are correct. Conducting a price audit for your company can help you to analysis performance and put together stringent and effective plans for future pricing, and how to negate any pricing problems that may arise.

There are a few processes to go through in order to have a successful price audit at your company, so let’s take a look at how you can maximise the effectiveness of your pricing analysis.

Define Clear Goals for the Entire Organisation

Everything you do in the future in terms of pricing strategies and pitching of products and service will only work if they come from an authentic place from the centre of the organisation. Putting in place clearly defined corporate objectives and goals will help you when it comes time to shift pricing strategies in the future. Everyone within your organisation should have a clear understanding of what it is the company is aiming for, with all aspects of the business working towards those objectives. Your pricing structures will be defined by your goals and objectives, whether you are looking to measure market share, profitability or other metrics.

Thorough Review and Analysis of Current Conduct

There is no time like the present to have a root and branch review of all aspects of your pricing structure. This includes any processes to come up with prices, whether you have any discounts on offer at this time, or other incentives, and to which customers these apply. If there are different selling and pricing practices in different departments of your company, look at the detail of how this works and why you initially had this in place. As part of this process of analysis you should interview the management team you have in place to gather their thoughts and feedback on pricing. As a separate and confidential process you should also survey your sales team, as they are at the coalface dealing with clients either face-to-face or over the phones/internet. After this there should be a review of all pricing across multiple distribution channels (if you have them) and a comparison made with your historical pricing data and any competitors and marketplace standards of today.

Look for New Opportunities for Change

Utilising the information you have gathered as part of the price audit is the starting point for something even better, improving your strategies to maximise performance and profits. You’ll have learned about where the pressure points are in your organisation and where you fall down on pricing when compared to competitors. It is an important learning curve and provides you with a chance to tweak your approach and test out new processes to improve the performance of your entire organisation, based on the new clearly defined goals and targets you have discussed and agreed upon in the wake of the price audit.