A recent study conducted by Forrester Consulting on behalf of intelligent pricing platform, Flintfox International reveals that retail, manufacturing and consumers goods companies are facing fundamental challenges in managing their profit margins, due to the ongoing impact of Covid-19, inflation and supply chain issues.
90% of businesses report that Covid is having a critical impact on the ability to manage pricing across their product range, with 39% stating they are unable to keep up with the scale of real-time price fluctuations occurring in the market. This is having a significant knock-on effect; with businesses losing on average $1m a year in lost profitability due to their inability to respond quickly enough to market forces.
The study of over 900 business leaders has revealed that existing business models are preventing them from being able to manage the pace of change, with 41% still relying on manual processes to manage price fluctuations. Over half (53%) state that the pandemic has forced them to need better visibility into business performance on profitability and margins to respond accordingly.
2022 will see business model transformation pushed up the Board agenda as global change becomes increasingly unpredictable, with 60% of businesses claiming that poor data quality and capture is hampering the ability to keep on top of market fluctuations and remain competitive.
The research indicates that a shift to real-time, automated management of pricing, will be a fundamental business priority to manage the impact of global disruption in the year ahead, with one in five (23%) businesses implementing intelligent pricing technology in 2022.
As the long-term effects of Covid-19 on the world’s economy become increasingly unpredictable, automating decisions around product pricing with intelligent pricing is now seen as one the most important factors impacting business outcomes by more than three quarters (77%) of businesses.
John Moss, CEO, Flintfox, commented: “After the continued uncertainty of the pandemic, margins have never mattered more. As inflation and supply chain issues continue to wreak havoc, it’s becoming increasingly critical for businesses to be able to respond rapidly to market fluctuations. Moving to an intelligent pricing model will enable businesses to better handle operational complexities and future-proof their businesses from harmful market events.