Summary
Sales teams often offer aggressive discounts to close contracts, resulting in an unnecessary dilution of margin. Conversely, some profitable deals are lost due to an inflexible application of the discount policy.
We first present the pricing models commonly used by parcel networks and a typical example of profit leakage. Next, we explain how to control discounts and leverage sales data to improve their accuracy with a typical effect of 2 to 4 points of additional EBIT.
