Extreme pricing pressures and intense competition from a broad field of players shape the business environment for the equipment rental industry. Recently, year-over-year revenue losses have reached 20-30% or more. In the field, sales forces operate in a subjective, relationship-driven environment, and revenue-based compensation can result in on-the-spot discounts that may land sales, but shrink margins for the company.
Pricing Challenges
Communicating a corporate pricing strategy to the field is one of the rental industry’s primary challenges. Further complicating matters, gathering the data needed to make complex pricing decisions takes time, and even if the data were at hand, most sales people don’t have the technical expertise to perform the necessary analysis. Sales forces need a way of arriving at an unbiased price quote based on factual data analysis, not gut instinct.
PROS Solution for Equipment Rental Services
Taking into account the unique requirements of the equipment rental industry, PROS optimization solutions provide floor, target, and stretch prices as negotiation guidance, with customer specific recommendation that factor in willingness-to-pay. The result is an alignment of in-the-field pricing with overall business goals, and the tools you need to better manage your margin.