A coffee together with Marco Bausi, Pricing Manager at Savitransport HQ, who explains what Pricing is and how it has changed in recent years.
Pricing is the process of determining the tariff to be applied to either a shipment, a Customs or logistics service. In a perfectly competitive marketplace, as is that of our sector, determining the price at which a service should be offered is undoubtedly both a delicate and pivotal factor in corporate strategy. In turn, companies selling or importing their products in the global marketplace, as well as those importing components and raw or semi-finished materials, cannot omit factoring in the costs associated with the handling and management of goods alongside the costs of manufacturing the products themselves.
Our work begins with a detailed analysis of the customer’s needs. It is not true that saving on logistics costs is the one universal characteristic of those who sell or buy their products overseas. For example, for various product categories, the most important variable is certainly speed of service, just as for other sectors the regularity of receiving supplies is the key factor, similarly for others the management of returns has a significant impact. Those who manage high-value products in the world marketplace will have expectations and logistical needs that are more than likely to lead them to choose premium services at higher costs. Products that require punctuality and fragile goods will preferably require the use of direct services, while slower and cheaper connections may be more suitable for those goods that are produced well in advance and are not subject to greater risk from transhipment.
Those involved in Pricing must firstly be expert sales people that understand the intrinsic service value as perceived by the customer, as well as the logistical needs and expectations, prepared to use their own experience to identify the best logistical solution to propose in order to meet these requests.
The Pricing team that works at a freight forwarding company must also have a working knowledge of the operational side of shipping. Being able to construct a tariff in fact implies the detailed knowledge of the single segments that comprise the movement of a shipment from point to point. It is of course essential to know what costs the service provider incurs, but it is also because each segment then comes into its own, allowing it to be modified and offer a more specific and personalized service to each client. As an example, we recently advised and assisted a client in adopting ‘Landed’ shipping terms for their goods, which has already saved them and will continue to save them, thousands of Euros in the U.S. .
Customs operations costs. This type of knowledge must go hand in hand with constant dialogue and reciprocal cooperation with all the operative departments. It is the latter, in fact, who materially move goods every day and who have a precise vision of how the market is moving and who can offer detailed indications when constructing a tariff. Of course, any Pricing Department must also be aware of its competitors’ market trends, because this serves both as a guide and point of reference.
Our ideal candidate has therefore worked in both sales and operational departments, but I would also add that they must also have a good sense of creativity, because as they say, "the solution is found by those who seek it. These last two years have shown us in particular how circumstances beyond our control push us towards more creative solutions. A practical example: faced with a slowdown in transit times and in the number of regulated departures due to local lock downs in the countries of origin or destination of shipments, many companies found themselves in need of shipping goods as quickly as possible, not due to any urgency in processing orders, but simply because they needed to free up space their warehouses and production areas. Given these circumstances, in order not to lose operability and consequently new orders, companies agreed to ship as soon as possible at much higher prices. Here a winning solution we adopted with various customers was literally to become their logistics department and carry out all the order-processing operations in our various warehouses. In short, companies that had never previously outsourced logistics were able to optimize production with our assistance.
Of course, our work is made easier and more efficient by being an integral part of the Savino Del Bene Group. As part of a highly specialized global company, with a worldwide network of offices and agents, we have the possibility of accessing up to date logistics information and market trends from all over the world. The weekly meetings attended by the Managers of each commercial, operative and vertical market areas, our internal newsletters, and the sharing of critical data places us in a preferential position in terms of access to information and above all to services and rates, when compared to companies in our sector that operate as single entities.
Autor: Francesca Savia
Operations and Compliance Manager
Savitransport – HQ Florence