Pricing Optimization for the Automotive Aftermarket - Lecture 6.2

00:00 Introduction
02:49 Demand, price and profit
09:35 Competitive prices
15:23 Wants vs needs
20:09 The story so far
23:36 Directions for today
25:17 The unit of need
31:03 Cars and parts (recap)
33:41 Competitive intelligence
36:03 Solving the alignment (14)
39:26 Solving the alignment (24)
43:07 Solving the alignment (34)
46:38 Solving the alignment (44)
56:21 Product ranges
59:43 Unconstrained parts
01:02:44 Controlling the margin
01:06:54 Display ranks
01:08:29 Fine-tuning the weights
01:12:45 Fine-tuning compatibilities (12)
01:19:14 Fine-tuning compatibilities (22)
01:30:41 Counterintelligence (12)
01:35:25 Counterintelligence (22)
01:40:49 Overstocks and stockouts
01:45:45 Shipping conditions
01:47:58 Conclusion
01:50:33 6.2 Pricing Optimization for the Automotive Aftermarket - Questions?


The balance of supply and demand very much depends on prices. Thus, pricing optimization belongs to the realm of supply chain, at least to a sizeable extent. We will present a series of techniques to optimize the prices of a fictitious automotive aftermarket company. Through this example, we will see the danger associated with abstract lines of reasoning that fail to see the proper context. Knowing what ought to be optimized is more important than the fine print of the optimization itself.