Introduction

The List Price Optimization Accelerator is a powerful tool designed to help you optimize your pricing strategies by leveraging historical transaction data. In this section we will walk you through the process of utilizing the accelerator, from creating a new model to analyzing the results. This is just a brief description.

Using List Price Optimization

1. To run the List Price Optimization Accelerator, create a new Model Object from the Optimization > Models menu.

2. The Definition Step involves user inputs for transactions, which can be filtered and mapped as needed.

3. The Scope Step aggregates transactions by product and customer level and allows for various filters to be applied.

4. The Configuration Step defines the optimization configuration, including global strategy rules and optional alignments between product prices.

5. The Strategy tab in the List Price Optimization Accelerator allows you to set values for the optimization problem, including limits on list price changes and optimization settings. You can define the maximum decrease and increase percentages for each unit list price, ensuring prices stay within specified bounds. The optimization settings include a target for margin rate increase, expressed in percentage points, indicating how much the margin rate should improve.

6. Additionally, you can set an overall list price change percentage, which serves as an average increase target, and define specific list price changes by product group.

7. In the Business Alignments tab, you can establish up to five alignment rules for product pairs, ensuring consistent pricing relationships between similar products. This requires a Datamart or Data Source with specific fields and allows for setting minimum and maximum price gaps between aligned products.

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   Example of an alignment Data Source

8. The Advanced Parameters tab offers fine-tuning options, such as adjusting the number of optimization steps, setting a maximum running time, and enabling profiling to understand optimization processes better.

9. The Results Step runs the optimization calculation and provides various tabs for analyzing the results, including Impact, Details, Glassbox, Drivers, and Evaluation tabs.