Industry

Chemicals & Materials
Base Materials & Metals

Company Profile

  • $14bn annual revenue
  • Integrated production in three business units in more than 50 countries
  • Strong focus on capacity utilization to drive down fixed cost per unit

Situation and Objectives

  • Establish pricing principles and structures to return to sustainable margin level to cover cost of capital
  • Transform the commercial approach to balance volume and margin targets

Pricing framework development and global roll-out

Results

  • Define mid-term margin and market share targets
  • Develop price guidance for improved internal transparency and steering of sales
  • Shorten pricing cycles to more than once per year
  • Establish systematic price increase management process incl. acceptable volume losses
  • Adjust sales variable compensation balancing volume and margin targets
  • Plan communication activities to employees and customers to support stepwise implementation

Impact

  • 10% price over three years
  • at market share target