Compliance
Pricing is coming under greater levels of scrutiny. News stories of price fixing, price gouging and anti-competitive behavior appear regularly and authorities are responding by applying legislation and regulatory controls in an attempt to prevent such activities.
The result is greater pressure and administrative effort on companies to ensure they comply with the various legal requirements. The cost of non-compliance is severe, financially and in terms of public perception and brand image.
The solution is to apply appropriate controls to the pricing process, such as:
- Assign authority limits, by individual, to limit price change levels
- Define and support approval processes when authority limits are reached
- Apply regulatory requirements as additional pricing rules or constraints
- Capture when manual price overrides occur (and the reasons)
- Log all instances of price change in a database and archive for reporting purposes
- Audit trails to trace how price recommendations are derived
- Compliance reports to ease administrative burden
For some countries having a formal pricing system with clearly defined pricing rules will be sufficient. Others will require more stringent controls including many of those outlined above.
The cost of compliance failure significantly outweighs the investment cost to put appropriate controls in place.
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