Price Harmonization Project: What is the recommended price level (Recommended Retail Price) which should be suggested by Avery Dennison to their distributors in the 2 European countries (Germany and United Kingdom) in regards to the competition in the market?
ANDIKA BRAMANTIO , Gijs Dankers; Adrian Borggreve
2014 | Skripsi | S1 MANAJEMENAvery Dennison adalah salah satu pelaku utama dalam sektor manufaktur LPM (Label and Packaging Materials), dengan lebih dari 16,000 karyawan secara global. Didirikan pada tahun 1935 di Los Angeles oleh R. Stanton Avery, kantor pusat Avery Dennison berada di Glendale, California. Selain LPM, Avery Dennison juga memasukki beberapa industri lain seperti Graphics and Reflective Solutions (GRS), Performance Tapes, Retail Branding and Information Solutions (RBIS), Radio Frequenfcy Identification (RFID), dan Vancive Medical Technologies. Pada saat ini, terdapat kompetisi yang cukup signifikan pada bidang Graphics and Reflective Solutions (GRS) Avery Dennison, terutama di pasar Eropa. Pertumbuhan kompetitor sedang menjadi fokus dari Avery Dennison pada saat ini. Dalam membangun strategi positioning yang superior dibandingkan kompetitornya, Avery Dennison mencoba untuk hadir di mayoritas distributor yang berada di pasar Eropa, hanya saja setiap distributor yang memiliki hubungan transaksional dengan Avery Dennison memiliki harga yang berbeda-beda untuk produk sama yang ditawarkan di pasar. Hal ini membuat strategi positioning yang diterapkan tidak efektif. Fokus utama dalam riset ini adalah untuk memberikan harga rekomendasi ritel (Recommended Retail Price) bagi distributor di dua negara di Eropa (Jerman dan U.K.) yang menjadi pasar utama dari Avery Dennison Materials Group, dengan mempertimbangkan kompetisi yang ada di pasar. Adapun penelitian ini dibagi menjadi tiga fase;fase pertama adalah tahapan pencarian distributor yang menjual produk AD dalam katalog produk mereka, kedua menimbang pengaruh distributor terhadap keberlangsungan bisnis melalui proxy revenue share, ketiga adalah mengidentifikasi kondisi penetapan harga, posisi dan harga barang relatif dengan kompetitor, dan yang terakhir adalah menentukan strategi penetapan harga dan pemberian rekomendasi harga barang kepada distributor. Adapun beberapa temuan yang dapat ditarik dalam penelitian ini adalah: produk AD sedikit kurang representatif dibandingkan dengan kompetitornya di distributor yang terdapat di negara Jerman, namun memiliki revenue share yang cukup tinggi di kedua pasar. Dalam lingkup kompetitif, terdapat tiga kompetitor yang direpresentasikan dengan jelas di pasar, termasuk Paragon, Magna, dan Bender. Selain itu, juga terlihat bahwa di dalam pasar produk GRS tidak terdapat sosok price leader yang cukup berpengaruh dalam penentuan harga. Adapun konklusi yang dapat diambil dari penelitian ini adalah bahwa pengambilan strategi parity pricing dapat dimanfaatkan oleh AD dalam kondisi pasar ini, dan dalam pelaksanaanya, rekomendasi harga pasar dapat dijalankan dalam bentuk Manufacturer's Suggested Recommended Selling Price (MSRP).
Avery Dennison is one of the major players in the labeling and packaging material industry. Employing over than 16,000 employees worldwide, AD has successfully reached the level of approximately $6.036 billion in 2013. Founded by R. Stanton Avery in Los Angeles (1935), Avery Dennison is currently headquartered in Glendale, California. Aside from Labelling and Packaging Material, Avery Dennison also focuses in different industries such as Graphics and Reflective Solutions (GRS), Performance Tapes, Retail Branding and Information Solutions (RBIS), Radio Frequency Identification (RFID), and Vancive Medical Technologies. Currently, there is a huge competition in the Graphics and Reflective Solutions market of Avery Dennison, especially in the European Market. Growing competition has been one of the company's main focus for this business. Pricing is one of the major deciding forces in the competition of every products in every markets, this is also true for the graphics market of Avery Dennison. Through its distributor's channel, Avery Dennison is able to be present in several countries in Europe. However, every distributors which has a transactional relationship with Avery Dennison applies different prices for every products which they offer. Needless to say, this creates a disharmony in the product pricing as well as price positioning of Avery Dennison relative to their competitors. With that being said, however, the company is not able to create a fixed retail price to the distributors, due to the anti-trust law in the countries they are operating in. This creates a sort of complexity where in one side a fair price signal is needed, while they are not able to implement a single fair price. This research paper attempts to create an advice for the company in creating the suggested retail price as well as the price level and positioning relative to their competitors. The main research question for this research is "What is the recommended price level which should be suggested by Avery Dennison to their distributors in the 2 European countries (including Germany and United Kingdom) in regards to the competition in the market" The research focuses on literatures which are gathered in order to answer the central question and a field research. The field research is done in 5 different steps. First, identifying the distributors in the two markets. Second, weighting the distributors influence through revenue share percentage. Third, identifying the pricing condition as well as positioning and price level for each distributor. Fourth, creating a pricing plan, and finally the suggested retail price. The findings of the research are as following: from the distributor overview, it can be seen that AD is rather under-presented in Germany market. Moreover, it can also be concluded from the section that the company has a relatively high revenue share in both of the markets. In the competitive environment, it can be seen that there are three main competitors who can be seen to be most present in the market, which are Paragon, Magna, and Bender. Moreover, it can also be seen that in the market, there is no price leader, as price positioning also varies for all manufacturers. In terms of international pricing, it can be seen using Big Mac Index that GBP is undervalued against EUR by 6.8%. Finally, in the perspective of price fixing law, it can be seen that there is a possibility to create a suggested retail price without violating the anti-trust law. From those finding, the research can recommend AD to implement a price parity strategy where the prices of the products from AD will follow their competitors. This recommendation is based on a SWOT analysis implemented in later part of the paper.
Kata Kunci : Pricing Strategy, Price Setting, Distributors, B2B Company
