As global Knowledge Process Outsourcing (“KPO”) firm, The Smart Cube enter their second decade we are excited to reveal a significant step forward in their evolution with the launch of their new brand.
Month: February 2013
By Johnny Hewett, CEO Smedvig Capital, originally posted on www.growthbusiness.co.uk
‘Price is what you pay. Value is what you get.’ Predictably wise words from the Sage of Omaha himself.
These words from Warren Buffet are a great reminder for many growing businesses to make sure that sufficient time is invested in getting the price for goods or services correct.
Of the many areas in which we spend time working closely with management teams, frequently top of the priority list is a detailed review of pricing. Clearly there are many drivers that are used as starting points, but in our experience there is a tendency to allow what it costs to deliver that good or service to over-influence pricing decisions rather than in our view the only critical question of what value is being delivered and hence what ‘should’ you charge.
Once you have a reasonable understanding of what a consumer ‘should’ pay, what it costs to deliver the good or service is highly relevant as at a basic level it helps define the ultimate capacity of the business to deliver profits but it is in this that cost is relevant not in pricing decisions.
Whilst there is clearly merit at times for more tactical decisions on price such as penetration pricing more frequently called land grab, it is critical in our view to do that from a basis of understanding of at what price a consumer receives value.
If the price is set too far below perceived value, the company will leave money on the table and compromise its ability to succeed profitably. If set above received value, even if initial take-up is good, customer retention numbers will be poor as will the vital word of mouth endorsement that can be a powerful driver of growth in many developing businesses.
There is an often-held belief that in some areas pricing is ‘more of an art than a science’ and, particularly in the area of truly revolutionary products where there are few if any relevant comparators, it is harder. But, as described below, there is in most cases some relevant ‘science’ to help guide pricing decisions.
Our recommended starting point involves two main principles, first, respect pricing history but don’t be dominated by it and second, invest the time and money in developing as much science as is reasonably possible.
The first goes back to the starting point of delivering value. It is understandable to be nervous about a significant change in pricing but ultimately if the consumer is receiving value they will be accepting of change – albeit too radical a move all at once would be difficult to implement. However, the importance of losing the constraint of history is it allows a thorough review of all elements of pricing including not just level but structure.
Levels of complexity vary according to product/service type, but the balance between: upfront fees versus ongoing fees, fixed versus variable, deposit versus fee, etc can significantly change the economics for the company whilst frequently not worsening and even improving perceived value.
Developing ‘science’ is principally about two elements. One is rigorous analysis of all available data on how customers currently interact with the company (and in many cases improving systems to ensure all relevant data is captured) along with a detailed understanding of the alternative offerings by its competitors or substitutes.
Customers can provide enormous insight into how and what they value in a product or service through demonstration of how they consume it. The other is creation of data and its subsequent analysis through carefully tailored primary research of both existing and target customers. A favourite without being too technical is conjoint analysis which can provide sometimes surprising insights into how customers see alternative pricing structures and hence value.
One particularly striking example was at Streetcar (now Zipcar), the UK-based car sharing club. Detailed research and statistical analysis helped us understand which levers of pricing members were most sensitive to and which they were least. This helped management to revamp the pricing structure to a model that better optimised profitability and member satisfaction. The result was a 70 per cent increase in contribution per member with no negative impact on churn.
Armed with the best possible understanding of the value a customer places on a company’s product or service and their view of alternative ways of charging provides an excellent starting point to developing the correct pricing architecture. Whether the company can deliver it profitably at that level is an equally important but different question.
Tusker, the UK’s market leader in salary sacrifice car schemes, has launched an advanced new driver site with upgraded features, new functionality and an improved user experience to help drivers select the most suitable salary sacrifice car.
The new driver site updates the previous site that Tusker offered and new features will help employees choose a car that most accurately meets their lifestyle needs. It is available to all drivers whose employers have implemented a salary sacrifice car scheme from Tusker.
The new, more visually appealing site includes an enhanced search function enabling a ‘quick car search’ if the driver knows what vehicle he or she is looking for, or a more ‘advanced search’ if they are undecided and want to see which cars fit their needs, budget and lifestyle.
Amongst other new features, the new site includes an enhanced image gallery with a wide selection of external and interior images, dynamic 360-degree tours of each car and the ability to select and compare body colours.
The site also features independent road test and review information on each car from industry experts What Car? to provide drivers with impartial advice on making the perfect choice.
An enhanced car comparison tool enables drivers to compare the key facts of up to four cars side-by-side, while there is a new facility for compiling a wish list of desirable cars alongside saved quotes. A new web page shows all current special offers and details of forthcoming new model launches in one place.
To give drivers a simple overview of the car scheme, the site also features a new animated video explaining all the essential information.
Tusker marketing manager, Candice Oosthuizen, who has overseen the project, said: “We are absolutely thrilled to have launched the new driver site to all our customers and their employees. The initial feedback has been extremely positive.
We have made major enhancements which take our site to a whole new level and make it so much easier for drivers to find out more about the scheme, and effortlessly search for and select the perfect car to suit their needs and lifestyle.
Choosing a new car is a big decision and, from research, we know that over 70% of employees who order a car through the scheme don’t have a specific car in mind when they initially log on to our site.
The new advanced search functionality, along with the significantly enhanced image gallery, new car comparison tool and road test reviews make it so much easier for employees to find the right car for them,” she said.
We are delighted to announce that myhomemove have won the award for The Best Conveyancing Service at this year’s Mortgage Strategy Awards at Grosvenor House in London.
This is a huge achievement for myhomemove particularly as the award was judged by more than 20 leading industry figures and so to be recognised as winners by this group of highly experienced professionals is indeed an honour and a big compliment.
Doug Crawford, myhomemove Chief Executive said, “We have been the largest conveyancing business in the UK for some time, but prestigious awards like this, which recognise how we deliver what we do is a huge endorsement of the service we deliver to our clients and introducing customers on a daily basis, so I want to just simply say thank you to every single person in our business”.
The Smart Cube, a global professional services firm that specializes in delivering custom research and analytics, was recognized in Supply & Demand Chain Executive magazine’s 13th annual “Pros to Know.” This is the fourth consecutive year the firm has been recognized.
Supply & Demand Chain Executive magazine is an international B2B publication that provides mission-critical editorial to address the issues and challenges of the supply chain. The magazine annually recognizes exceptional supply chain practitioners and providers who are leading initiatives to help prepare and enhance supply chains for the significant challenges ahead. The Smart Cube’s selection was made by the magazine’s editorial selection committee, which culled through nearly 400 submissions to find those applicants that best fit its stringent selection criteria.
“We are honored to be part of the Provider Pros to Know list for the fourth consecutive year,” said Omer Abdullah, Co-founder and Managing Director of The Smart Cube. “We have worked hard to help supply chain practitioners balance traditional issues such as cost management, a ‘more with less’ mindset, and risk mitigation with emerging challenges such as innovation and revenue enhancement. In this context, the need for insightful, real time supply chain intelligence is critical and this award is a clear recognition of our work in this space.”
“It’s not always initially clear as to how broad the scale of the supply chain and its challenges really is,” said Barry Hochfelder, Editor, Supply & Demand Chain Executive. “If there are those present in the industry who are working to overcome such issues and grow the global supply chain at the same time, they should get the recognition they deserve for their achievements.”
More information on the 2013 Pros to Know list can be found at http://www.sdcexec.com.
Tusker, the UK’s leader in salary sacrifice car schemes, today announced that its 100th scheme has now gone live.
The Watford-based contract hire, leasing and salary sacrifice specialist achieved the ‘ton’ with a scheme for The Royal Wolverhampton NHS Trust, which has some 6,165 eligible employees.
Tusker’s award-winning salary sacrifice car solution, SalarySacrifice4Cars (SS4C), is used by organisations in both private and public sectors throughout the UK to provide access to brand new cars for employees who would not normally qualify to receive a company car via a salary sacrifice arrangement.
The SS4C scheme is expected to deliver substantial cost savings to The Royal Wolverhampton NHS Trust, and is available for all their permanently contracted employees.
Tony Stanyard, Head of Procurement, said: “We originally implemented the car salary sacrifice scheme to deliver cost savings to the Trust, whilst providing staff with a car leasing scheme that was flexible and designed to meet their motoring needs.”
“We selected Tusker as our service provider following evaluation of a number of providers on the Health Trust Europe Framework and have worked hard with them to get the right scheme for our staff. We wanted to ensure that our employees have access to a safe, well maintained and fully insured new car.”
Stanyard continued: “The feedback from our colleagues has been very positive, citing that the website is user friendly and makes the selection of the vehicle easy, tailoring the car to their needs.”
“From a Trust perspective, implementing the car salary sacrifice scheme has been relatively simple, with most of the work being completed electronically.”
“The initial levels of interest have been very encouraging and we look forward to a continuing positive relationship with Tusker as the roll-out of the scheme continues,” he said.
Tusker CEO, David Hosking, said: “I’m delighted we’ve now launched our 100th scheme and still have many more at implementation stage.”
“When we launched SS4C around three years ago, although we knew it would be popular, I don’t think that we had any idea of the true success it was going to become.”
“One of the secrets of that success is the scheme’s simplicity and the savings both employee and employer can make. SS4C offers all employees a tax efficient car, allied to fixed cost, worry-free motoring at very attractive rates, and we make the system very straightforward for them to use and understand.”
Once again businesses have been made aware of the increasing threat of fraud, but this time it’s the enemy within they are told to watch out for.
CIFAS has reported a 43%* overall increase in the number of staff frauds recorded in 2012 when compared to 2011. The report refers to all types of major fraud, not just the obvious activities such as cash theft, which means businesses need to focus on several areas of potential threat.
With such a notable increase this can only act as an indicator to businesses, particularly in the legal sector, that it is time to focus on prevention rather than cure.
Leading independent conveyancer myhomemove became the first law firm to join CIFAS. Kevin Smith, Operations Director at myhomemove said “We are surprised that no other conveyancers have yet joined CIFAS because in addition to combating internal fraud, the tools we now use also allow us to identify potentially fraudulent clients and indeed law firms”.
Many businesses may question the merit of fighting fraud when the problem seems such an arduous task involving substantial time and resource. This only highlights the problem of fraud remaining overlooked, particularly as internal fraud can be seen as less commonplace.
Dev Malle, Group Sales Director at myhomemove added “It is astonishing that with the level of media coverage this subject has received that many law firms do not see or understand the level of Lender concern in the area of fraud, less surprising may be the inability of many firms to invest into systems and processes that improve the quality of service and provides confidence to the client lender partners, this includes members of staff”.
Lenders voice concerns and demand tighter anti-fraud measures
The CIFAS report also highlighted the dramatic rise in the obtainment and disclosure of company data, along with a 22%* increase in dishonest actions by staff. This is obviously a big concern for lenders who are becoming more demanding when it comes to data protection. For many conveyancing firms this may seem like a burden requiring additional due diligence and tighter controls.
Rob Gurney, Head of Legal Practice at myhomemove’s ABS law firm Premier Property Lawyers, said “Lenders are often pushing for better anti-fraud measures and we are the first to admit this does take extra resource. However we believe that the benefits outweigh the costs – this is just one additional step that we take in fulfilling our regulatory duties and increasing our confidence in the legitimacy of the transactions we undertake”.