Slide 1: Pricing for Profitability Executive Education Course Review Slide 2: Why is this important?

- Determine customers willingness to pay (WTP) - Support product life cycle - Support our strategy - Confidence - Consistency - Transparency - Consistency for price changes - Establish Negotiation Range - Hospitals talk - Competition

Slide 3: Customer WTP - Value is defined as the perceived worth in monetary units of the set of economic, functional (clinical), and psychological benefits received by the customer in exchange for the price paid for a product offering taking into consideration available competitive offerings and price. - If the Value is not Clear, Your Price will Always be Too High - (Confidence in Value = Confidence in Price) Slide 4: Determining our Value - Value per patient What is a hospital willing to pay for $1 earned? Compliance per patient: $1, $5, $10 Communication per patient: $1, $3 Eligibility per patient: $20, $35

Slide 5: Determining our Value How do we assign these values? - Client surveys - Best guess - Assign the highest dollar amount to our top values

Slide6: ( I will add the graphs later) Determining our Value

VALUE
LOW HIGH

LOW

PROCESS MODIFICATION
HIGH 3 4

VALUE
LOW HIGH

LOW

PROCESS MODIFICATION

.
HIGH

Slide 7: Market Strategy - Hospital Direct o Subscription Based o Revenue Sharing - Vendor o Licensing Fee Suggested Retail o Revenue Sharing Slide 8: Costs - Determine PointCare Costs Slide 9: Contract support - Needs to support our pricing model (I will insert a graph here showing monthly/annual subscription cost post trial) Proposed Models - Price needs to support our product life cycle stage - Pricing model needs to support our strategy (I will insert a graph here) Slide 10: Effective Price Decision Process (I will add the graph)
Type A Customer 75% Revenue 10% Process Set Targets & Floors No Pilots? No Escalation nor Exceptions Assign Sales Mentor Insure Value Selling is Done Price Delegation within a Band Engage EARLY in Sales Cycle Cross-Function Team Decisions Hands-On Management / Negotiation Executive Sponsor Engages Customer High Sales Experience Team Leader Local Sales Play "Good Cop" - Higher Authority Tactic

20%

20%

5%

70%

Slide 11: Next Steps - Determine a number from 990 that can be used in our model - Assign a value per benefit - Understand our true costs - Determine a standard subscription amount - Set factor levels