PostNord is the state-owned parcels and logistics service provider for businesses in Denmark. The organisation has more than 10,000 customers. Most of them pay different rates, depending on their profile and volume.
The e-Commerce & Logistics business unit wanted to simplify things and be as competitive as possible. So, they planned to introduce two important changes: a standard pricing structure for smaller customers, and individual cost-based pricing for major customers. We developed a sales calculation tool to help PostNord understand how much it costs the company to serve different customers, based on past and present behaviour. That would allow the company to set rates and negotiate prices accordingly.
The tool incorporates factors like the number of parcels a customer is likely to send, where the parcels will be going and how often they might have to redeliver them. With this intelligence, sales reps can offer major customers the most competitive personalised price possible much more quickly, while maintaining acceptable margins.
And there are other advantages. The tool documents how and why different rates have been applied. That helps PostNord demonstrate they’re compliant with external and internal requirements. The tool also interacts with business systems to make invoicing more efficient and monitoring contracts easy.
We worked together using Agile methods to transform the way Post Nord’s e-Commerce & Logistics unit manages pricing. They have rolled out the ‘cost-to-serve’ approach across all their service lines. With clear intelligence on costs and margins, e-Commerce & Logistics can make smarter plans for developing business in their increasingly competitive market.
"PA have a great understanding of our business and have been able to bring structure and clarity to extremely complex challenges. The sales calculation tool they’ve developed is now absolutely vital and integrated with our business planning, giving us the insight we need to set rates and negotiate prices intelligently.”
Claus Fræhr Mikkelsen Financial Director, Logistics Business