Often when we first engage with new clients we find that they do not offer the correct rates which often impacts profitability. This can be improved by a number of services which Perfficiency can offer. We can conduct a thorough examination of your cost base and through accounting methods such as Activity Based costing we can make sure you have appropriate cost bases when calculating rates to ensure they are both competitive and profitable.
We can also conduct market exercises to gain an understanding of what you competitors are charging.
Through Technology we can also explore opportunities to offer rates more quickly, efficiently and accurately. We can develop bespoke costing solutions to enable you to turn rates around as quickly and accurately as possible.
We not only offer help for producing pricing models but we also offer analytical solutions and bespoke systems for understanding profitability. When it comes to operation profitability, businesses simply know if operations are profitable or not. We can analyse your operation to understand which specific elements are profitable and which are not enabling you to target loss leading operational elements to turn them around and make more profit.
The cost model initially produced by Perfficiency and then later developed to be incorporated into the Route Rater system has enabled us to have a greater understanding of the profitability of our work.
We will work with you to produce a pricing model which is most appropriate for your business, we often use accounting techniques such as Activity Based Costing or Marginal Costing to produce the core costs of any pricing model. We then identify the variable elements and come up with how they should best be captured for any quote. Then we work on the user interface which can be based on a spreadsheet, database or a bespoke system. With our help you can have an accurate, competitive and profitable model for issuing quotations.
As with any pricing model, it is fundamentally based on a prediction of an outcome due to potential variable costs. We can then take the process one step further by producing you models and tools to work out actual profitability. Often businesses are restricted to understanding profitability to only their management account which will in the most part take a holistic view of operations however we have helped big businesses understand profitability by differing operations even down to the level of one individual job. In turn this information is very valuable as it will enable you to alter your predictive models based on actual real profitability scenario’s.