In this episode of The Thoughtful Entrepreneur, your host Josh Elledge talks with Per Sjofors, famed author of The Price Whisperer: A Holistic Approach to Pricing Power and CEO and Founder of Sjofors & Partners Inc.
Sjofors shared his education, work experience, and expertise in creating the right pricing strategy for a specific niche, and found that many companies underpriced. Drawing on experiences and proven pricing strategies, he shared how the process he has developed over the years could answer questions about pricing. This includes what the market is willing to pay for a product or service, accurately forecasting sales volume and revenue, and using data to set the right price.
Sjofors also discussed its strategies and process on how to derive prices. Over the years, he has shared his observations that some companies set their price based on different factors, such as competitor prices and market price, which are often pure guesswork. He pointed out that using data obtained from pricing experiments will help identify the fair price the market is willing to pay for that product or service. Asked about the pricing of a product or service, he stressed that it must result from an expectation of quality or profit.
Key Points from the Episode:
About Per Sjofors:
Per Sjöfors is the founder and CEO of Sjöfors & Partners Inc, Los Angeles. He has used pricing as leverage to turnaround several European and US companies during his 25 years of executive management experience. Per thinks what business schools teach about pricing is too abstract for leaders to act on and is on a mission to make pricing practical and actionable.
Per has a unique appreciation for the importance of optimal pricing and brings with him his international experience of pricing practices from a global perspective. He has helped over 600 clients dramatically increase their sales and profits by providing an understanding of how pricing affects sales volume, adding billions to their bottom line.
About Sjofors & Partners:
Since 2008, the dedicated people behind Sjöfors & Partners have worked tirelessly in helping hundreds of companies worldwide (soon to be about the top of the one thousand mark) to significantly increase their sales growth and profit margin by helping them gain a better understanding of how everything they "do" in their business will affect their sales volume and pricing power.
In the mid-1980s, its founder, while CEO of his first company, Per Sjöfors, developed an interest in understanding how the particularities of pricing fit into a company's growth and margins and began experimenting in the companies he ran. Per discovered that business school teachings about pricing were too academic and theoretical. Pricing was discussed as a separate activity, completely detached and devoid of how it impacts the rest of a specific business when in fact, customer targeting, product and/or service features, marketing channels and messages, sales channels and methods, and price all interact together. Spurred on by this discovery, Per meticulously developed a process in which it is possible to use an original and proprietary online market research method that expertly predicts sales volumes at different prices for each aspect of a company's operation.
Sjöfors & Partners still uses this process to this day, more developed and refined, of course. They use this data specifically to understand how sales and profits leak from inefficiencies in a company's sales and marketing operation. And to further support the process, they have developed their own AI software that analyzes the data necessary in the process. The organization thinks that using AI software is essential as it eliminates the risk of any manual mistakes entering the process, and the AI software has the capacity to "dig" further down and with more depth into the raw data than any person could ever do. But AI is not enough. They use the other kind of AI, Actual Intelligence. Experienced business people assess the information created by the AI software to ensure their recommendations are intensely practical and always lead to unsurpassed business results.
03:00 - "If you have hard data on how the relationship between price, sales, volume and revenue, you can wanna set the right price."
10:03 - "The price of a product or a service sets an expectation of the quality or benefit."
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Links Mentioned in this Episode:
Want to learn more? Check out Sjofors & Partners’ website at https://sjofors.com/
Check out Per Sjofors on LinkedIn at https://www.linkedin.com/in/persjofors/
Check out Sjofors & Partners on LinkedIn at https://www.linkedin.com/company/sjofors/
Check out Sjofors & Partners on Youtube at https://www.youtube.com/channel/UCZASFPF0PEiAkQt8qmJqGeA
Check out Per Sjofors on Facebook at https://www.facebook.com/per.sjofors.3
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