Detailed design and implementation of pricing scheme for a leading transport operator in the region
Situation
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A transport operator is facing profitability issues and requires restructuring of its pricing scheme
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Conducted detailed assessment across three dimensions with the objective of developing the new pricing scheme including:
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Cost of Service: conducted a detailed cost allocation exercise with the objective of identifying direct and indirect costs for each route, service level and vehicle type
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Customer: conducted an wide scale survey (in cooperation with Synovate) that involved 2,000 existing and potential customers with the objective of identifying perception of service levels, supporting service needs, perception of competitive services, price elasticity levels, affordable pricing ranges and promotional aspects that would maximize revenues for the company
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Competition: analyzed competitive landscape on a micro (Route Level) covering formal and informal competition with the objective of identifying and evaluating service levels, supporting services, value proposition and prices offered by competitors on a route and service level
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Developed recommendations for pricing levels and packages on a route / service level
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Designed a pilot testing program for the new program, including an implementation plan (that involved distributors)
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Program managed the pilot testing of new prices and packages along identified routes, monitored and reported outcomes and recommended corrective actions and price adjustments, as necessary
Contribution
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New pricing implemented on over 130 services and 30 asset types