The Price Waterfall is a powerful tool for identifying hidden costs, and shows how much revenue companies really keep from each of their transactions.
It can be used to seal margin leakage by identifying areas where prices can be increased, or alternatively to ensure you are capturing more of the price that you already, in theory, charge.
Price waterfall is a simple concept, but it requires a long-term commitment and co-operation between different departments to realise the benefits.
In order to implement an efficient price waterfall, it is recommended that companies adopt a dedicated price management system alongside price training for their employees.
While this was very costly in the past, thanks to the rise of SaaS technology, acquiring a pricing system that allows companies to keep track of different types of discounts and incentives, as well as to set complex pricing rules and benchmarks, is no longer exclusive to large enterprises.
A large number of companies still don't understand the untapped opportunity, with much of it being low hanging fruit. Learn to love this concept, and you will reap the rewards in improved profitability.
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