Price Optimization – still a hot topic in Chemicals!

A few years back Eastman Chemical approached us to discuss the possibility of actually making current business decisions (what to produce, which customer orders to take on, which service-level to provide, etc.) based on what future pricing of raw materials could be. They wanted the intelligence to make data-based decisions on which products could be produced with the most profit at any given time, the goal being to optimize profit margins and reduce margin leakage.

By implementing SAP Price and Margin Management by Vendavo they were able to build upon the solid base of price, cost and volume date from their SAP ERP system.

Its thought leadership like this that makes it possible for chemical companies to stay profitable in hard times like these.  They have put the tools into place to make better and clearer decisions on a customer to customer basis. Another benefit that came out of it is the ability to explain to a customer why a price increase is reasonable and necessary. Given all the press on this in recent times, it seems its also a good way to retain good customers and strengthen relationships with strategic ones.

Link: http://www.sap.com/industries/chemicals/large/customers/index.epx
Eastman Chemical Company
Read how a worldwide manufacturer and marketer of chemicals, fibers, and plastics is responding faster to market conditions and pricing requests using the SAP Price and Margin Management application by Vendavo, which works with the company's existing SAP software to produce precise, data-driven pricing.