Ivory Consulting’s CEO Scott Thacker provides advice and counsel to equipment lessors on the best ways to improve customer satisfaction and profitability using pricing.
My last blog spoke about the three elements that most strategic plans have at their core: first, increasing shareholder value, second, raising customer satisfaction levels, and third, enhancing employee engagement. Pricing methods can influence all three of these in different ways.
We’ve already taken a look at the first two. Enhancing employee engagement usually comes from having a group of people that feel like a well-functioning team moving together to reach a given set of goals. In looking at many well-functioning teams, one characteristic is usually present–the team is constantly being intellectually challenged.
The equipment finance industry is changing rapidly. Are you making your team aware of these changes and asking them to react to them?
There are three trends happening now. First, the proliferation of data is allowing everyone to make more informed and accurate decisions. Are you asking your team members to rely on as much data analysis as possible? Secondly, the advancement of technology – such as the widening use of sensors – may change the way lease pricing is derived. We can now rely on sensor data to tell us how much of an asset is consumed in a given time period. Have you thought about basing a lease price on the amount an asset has worn out rather than the passage of time? Lastly, the sharing economy is driving new business models, one of which drives lessees to want consumption-based IT contracts. Do you know if your business models and IT systems will allow you to offer any time of consumption based contracts?
By asking your team members to focus on some of the current business trends you will not only keep them challenged but they will be proud to work for a creative and cutting-edge organization.
Next time we are going to change gears a bit and look at the in’s and out’s of a parent/subsidiary tax sharing agreement and how it factors into pricing.