A team of six product
managers sets prices each year for as many as 1,000 products per
manager. These products range from washers and screws to
large product assemblies. Because after-market parts are a significant
revenue source for the company, the pricing of even washers and screws
Besides the large number of
prices to be set was the large amount of information
needed to make informed pricing decisions on each: cost, cost change
from last year, last year's price, sales, how the part or finished
product was used, and more.
- Many products have
similar characteristics and so could be priced in a similar way.
- The volume of
information available could obscure things the product manager
needs to be aware of.
- Recording the
reason for a price was important, but unreasonable to expect someone
to record 1,000 reasons by hand.
- The volume of
prices to be set meant a high probability of mistakes.
My solution would
therefore need to address four areas:
I created a distributed MS SQL Server/Access/VBA application
called PACRT: Price And Cost Review Tool (pronounced
"pack-rat"). With PACRT, product managers can review product information as they like and to
set prices as they like. Each manager sees only the information
on the products for which they are responsible.
features of PACRT are:
Users create product
categories and assign products.
Users can view cost, price,
and sales info by category or individual product. They can
sort and filter by a large set of characteristics, including wild
card searches of product descriptions.
Users can set prices for an
entire category either by a fixed price or a target margin (with
some customizable exception rules if desired).
Users can still review and set
prices for individual products if they wish.
A quality assurance screen
lets users identify problems: they select a problem type
from a menu, then see which of their prices have that
With PACRT, a
product manager can now make informed pricing decisions on 1,000+ products in a few days.
PACRT was so successful that I was
asked to create something similar for the pricing of services.
Click the image
below for a slide show on PACRT: