A pricing algorithm and pricing app from scratch
At a glance
Caldic needed to streamline its pricing process for better pricing decisions
IG&H developed SMART, a pricing app that builds on the Caldic pricing framework by combining three manual processes into one AI-powered workflow for Product Managers
Pricing reviews now happen daily instead of annually, 6 times faster per product group
The Microsoft Platform app helped Caldic to price better based on its true (added) product value and was rolled out Europe-wide in 7 weeks
Caldic, a distribution solutions partner of specialty chemicals and ingredients, wanted to streamline its pricing processes. The goal was to provide more frequent and up-to-date pricing recommendations, thereby aiding Product Managers in client interactions and achieving margin uplift. Pricing is instrumental in achieving Caldic’s ambition to become a leading specialties distributor globally.
Existing pricing tools require many manual, time-consuming steps to adjust pricing. Given Caldic’s large assortment, Product Managers often had to rely on default pricing strategies. This led to significant revenue and margin potential loss. Caldic wanted to achieve full margin potential in all product groups.
Smart pricing: How Caldic transformed with AI and an app
Together with Caldic, IG&H analyzed pricing pain points and collaborated with stakeholders to create SMART, a scalable pricing app. IG&H created a pricing algorithm and integrated it into Caldic’s IT environment. This enables faster (in seconds), more frequent (as often as desired) and more accurate pricing decisions. The SMART app combines three manual processes into one easy-to-use app. It improves the pricing workflow for Product Managers with the security, scalability and integrations of the Microsoft Platform. After successfully piloting SMART 1.0 in two lead countries, Caldic successfully rolled it out across Europe in just 7 weeks, supported by training materials, designated super user support, impact monitoring and IT maintenance documentation.
Pricing made smart
Caldic went from an annual review guided by the pricing team to a governance framework that steers monthly results. The average time spent on pricing per product group dropped from 30 minutes to 5 minutes. More frequent up-to-date price recommendations will help Product Managers in client conversations and margin uplift. Reviewing pricing allocations for 80% of the portfolio took 6-8 weeks. Product Managers can now do the same with the SMART app in less than 2 hours.
Speed: Users went from two separate spreadsheet steps and data entry in the Pricing Engine to a seamless workflow with automated suggestions, review and submission in one app
Accuracy: The switch from manual analysis and interpretation to machine learning optimization and suggestions also made pricing more accurate
Frequency: The team was able to shift from annual – at best twice per year – pricing reviews to an automated trigger-based process fed by daily algorithm recommendations
Big picture: Finally, the app also facilitated a bird’s-eye view of pricing due to better governance and smart decision-making
“We have been able to fully re-engage not only Product Managers but also Sales teams on the new improved pricing recommendations. With the SMART app, we could reinforce pricing discipline through more accurate and frequently updated pricing strategies.”
Daina van der Wal | Pricing Leader Caldic Europe
“To accelerate our digitalization, we needed a partner like IG&H to help us combine our pricing, vision and strategy into a fantastic modern tool.”
Laurent Pasqualini | former CEO Caldic Europe
What made the pricing app adoption so successful?
The app was developed together with its end users. Working shoulder to shoulder with Caldic Product Managers, we incorporated their feedback at every stage, ensuring SMART met their needs and fit seamlessly into their workflows. The app was created based on the Smart Collaboration of stakeholders, data and design competencies. The team consisted of Caldic product managers, along with IG&H business analysts, data engineers, UX/UI designers, developers and project managers.
Throughout the Proof of Concept (PoC) and project implementation phases, we maintained close collaboration with stakeholders, including Product Managers and IT. This strategic partnership enabled us to address the right needs and challenges from the start, identify new ones during implementation and ensure that the final solution aligns seamlessly with Caldic’s business objectives, user requirements and IT infrastructure. The app was developed in 16 weeks, from PoC to go-live.
