In a study by IE Business School & Simon-Kucher & Partners, 1,225 executives from all industries were asked: “With a profit margin of 20%, how much does the volume of a product need to increase in order to compensate for a price reduction of 10%?” Only 4% estimated the answer correctly. 74% strongly underestimated the answer and 17% didn’t know.
Presented at a Professional Pricing Society webinar on 14th September, 2015 by Philip Daus of Simon-Kucher Partners.
Which category do you fall into?