Pricing process for the global operating environment

Abstract

Many companies operate in an increasing number of very diverse markets where the complexities of the B2B markets are further enhanced by the international operating environment. Simultaneously, as international involvement increases so does operational diversity within the companies. Together these result in prices that vary. As the internet allows customers to compare prices with ease, inconsistencies can cause significant harm. Unfortunately, academic research lacks descriptions of good pricing practices for the global operating environment, and where such exists, theory is far from the reality of companies. This thesis examined the global pricing of a medium sized Finnish company with the aim of identifying biggest challenges in current prices and developing a more cohesive approach for the company’s global pricing. This research combined inductive and deductive research approaches by collecting interview data first, due to limited prior knowledge on the subject, and then utilizing existing literature in theory building. Both qualitative and quantitative methods where used to generate data and hence the researched uses mixed methods. The study revealed that achieving more global pricing in the case company would require first addressing the issues in the current pricing. For each step of the global pricing process the characteristics of the global operating environment highlighted in the approach were dis-cussed in reference to the case company and the following challenges where identified: the role of strategy requires clarification and should be connected to pricing, common pricing priorities need to be developed, segmentation could be improved, there are too many prizing methods utilized to align with pricing capabilities and lack of clear pricing polices combined with large number of products makes implementation and control of prices difficult.