Successful industrial service pricing

Abstract

Purpose The purpose of this paper is to provide insight into the way industrial service firms price the services they render in the market, with particular emphasis on the pricing practices of pricing‐competent firms. Design/methodology/approach In order to achieve the study's research objectives, data were collected through a mail survey from 129 transportation and 48 information technology companies. Moreover, 20 in‐depth personal interviews were conducted in the initial phase of the research. Findings The study found that pricing‐competent firms have developed a “holistic” and multi‐faceted pricing approach, paying attention to both company‐ and market‐related pricing objectives, methods, policies, and information. Research limitations/implications These findings underline the multidimensionality that characterizes pricing decisions, necessitating a systematic approach triggered by the thorough examination of both company‐ and market‐related characteristics. The significance of these findings notwithstanding, the narrow context of the study does limit generalization of its findings to other service sectors and national contexts. Originality/value The paper constitutes the first attempt to examine empirically the concept of pricing performance in an industrial service context.