B2B Decision Sheet

Submitted By:
Aishwarya Soni
PGP12026

Summary:
A company by the name of Tupelo Medical Distribution specialises in selling
top-of-the-line blood pressure monitoring (BPM) tools for use in healthcare.
Price erosion has gotten worse over the last five years, and Robert, the pricing
manager, has noticed this. Davidson wants to see a 3 percent rise in top line gross
margin. One of the best-selling products is the Micron Series 8 Upper Arm Blood
Pressure Monitor System. Due to the wide variance in costs, Davidson has decided
to set acceptable minimum pricing (AMPs) for its products.
It might be difficult to determine the right minimum price that will allow Davidson
to meet their margin targets without sacrificing too much sales volume.

Dilemma:
The top-selling product for Robert Davidson has to have a 3% rise in gross margin
dollars, but there is a problem with uneven pricing between his sales staff and their
various accounts.

Recommendation:
Changes in sales tactics are required in light of Mr. Davidson's challenge of
needing to boost gross margin profit by 3% with Tupelo's best-selling product, the
Micron 8. First, creating an AMP with a segmentation by region will guarantee that
the mostly independent outside salesforce is held responsible for preserving the
company's margins. However, it will keep the sales force accountable for
preserving profit margins without micromanaging and demanding management
clearance for every discount on every client, in our opinion. This segmentation
deployment will undoubtedly result in some volume loss.Setting an AMP would
initially result in a volume loss, but we would make up for it with larger margins in
these two areas. Additionally, by limiting the customer's discounts, we can
continue to uphold the reputation of our brand as an industry leader.