Managing the Key Risk: Product Pricing & Margins
If this you, reach out anytime…….
Talking about risks.This is where the rubber meets the road.
I touch on this for several reasons.
First, markets are volatile, and this will not change.
Since I have also worked on commodity pricing strategies, traded commodities and energy, and managed the price fluctuation for mega-billion dollarcorporations down to $2 million dollar businesses, I would like to share some basic thoughts.
As this market becomes more commodity-like, some direct and creative pricing strategies with your suppliersand customers may be rather useful.
In creating pricing strategies, the first objective is to create more certainty in your cash-flow.Followed by locking-in gross and profit margins.
Cash is king, which is a no-brainer for cannabis CEO’s, for sure.In every other industry, though, many don’t get this “cashisking” concept.Since that is not a problem to digest for Cannabis CEO’s, I provide some additional thoughts on how to think through some creative cash-flow management techniques.
In a simple form, pricing differentiation can be in both intangible and tangible arenas.