Here Comes Smart Pricing

It’s Time For The Aggregates Industry To Unlock The Power Of CPQ 
And Shape A Future Of Efficiency, Profitability And Customer-Centricity.

By Barry Hudson, Laura Georgi and Oksana Verbetska

In the dynamic world of the aggregates industry, staying ahead of the competition is crucial. To thrive in this challenging landscape, companies must adapt to changing customer demands, streamline their operations, and maximize revenue. That’s where Configure, Price, Quote (CPQ) technology comes into play.

This game-changing solution has the potential to transform the aggregates industry, revolutionizing the way companies operate, sell, and succeed.

Unlocking Efficiency and Productivity
Traditionally, pricing in the aggregates industry has relied on manual processes, paper-based documentation, and complex pricing calculations. This not only leads to delays and errors but also hampers productivity. CPQ software automates and streamlines these critical processes, providing a centralized platform for managing product configurations, pricing, and quoting.

By digitizing and simplifying these tasks, companies can significantly enhance their operational efficiency, reduce costs, and accelerate the sales cycle.

Tailored Solutions for Every Customer
In the aggregates industry, no two customers are the same. Each project has unique requirements, specifications and budgets. CPQ empowers companies to create tailored solutions for each customer, ensuring their needs are met precisely.

Through intuitive configuration tools, sales teams can easily customize product offerings, selecting the right mix of materials, sizes and quantities. This level of personalization not only enhances customer satisfaction but also increases the likelihood of securing deals and long-term partnerships.

Oksana Verbetska

Optimized Pricing Strategies
Pricing in the aggregates industry can be complex, influenced by various factors such as material costs, transportation, and market demand. CPQ technology enables companies to implement dynamic pricing strategies, taking into account real-time market data and factors that impact costs.

By leveraging these insights, businesses can optimize their pricing models, ensuring competitiveness while maximizing profitability. This data-driven approach empowers companies to make informed decisions, resulting in increased revenue and improved margins.

“Integration of a CPQ with other software provides adaptability to difficult problem solving, a simple yet powerful way to handle complex sales processes, achieving efficiency across various operational domains not just sales.’’ – Oksana Verbetska, sales coordinator,

Graphic 1. On, input costs, surcharges and fees are automatically updated, ensuring minimum margins are maintained when input costs are fluctuating.

What Pricing Strategy Do You Use?
In the aggregates industry, there are four main strategies for pricing that are used. Depending on your company profile, the markets that you operate in, your competitors’ behaviors, typically your pricing should fit into one of these categories.

1. Cost-Plus Pricing
Cost-plus pricing is a straightforward strategy where the final price is determined by adding a markup to the cost of production. This strategy ensures that the company covers its expenses and generates a profit. While cost-plus pricing provides a sense of security, it may not consider market demand or competition, potentially leading to missed opportunities. The downside of this approach has been fully exposed over the last two to three years of rampant inflation. While many companies have recorded record revenues, on an apples-to-apples basis, profitability has not kept up. As an industry, we are very poor at applying robust and accurate product costings. Obviously, this should be a prerequisite for any cost-plus model.

2. Value-Based Pricing
Value-based pricing focuses on the perceived value of a product or service to the customer rather than its production cost. This strategy aligns pricing with the customer’s willingness to pay, considering the benefits and outcomes delivered. Value-based pricing enables businesses to capture a fair share of the value they create, but it requires a deep understanding of customer needs and effective communication to justify higher prices. Unfortunately, we can recognize the pitfalls for this approach in the aggregates industry. Very few companies have up to date market information, and fail to understand their own Unique Selling Proposition (USP). This is most noticeable when studying specialty aggregates and sands.

3. Competitive Pricing
Competitive pricing involves setting prices based on the prices charged by competitors. Aggregates companies analyze the market and adjust their prices to match or position themselves competitively against rivals. While competitive pricing can help businesses gain market share, it may lead to price wars and erode profit margins if not carefully managed. I think it is fair to say that we all recognize this “strategy.” However, what tends to happen in our industry is that it becomes a race to the bottom.

As Oksana Verbetska, sales coordinator at, explained, “Typically when we ask a salesperson why they set their price for a given product where they have, the reply comes straight back as – that is what the competitor sells it at.” Of course, if we were to ask the same question of the competitor, they would also say, “We set our price based on the pricing of the original sales person.” A never-ending spiral. Breaking these bad habits is one of the drivers to achieve significant top line growth with a structured pricing strategy.

4. Dynamic Pricing
Dynamic pricing involves adjusting prices based on various factors such as demand, time, and customer behavior. Aggregates companies can use data analytics to determine optimal prices and offer personalized pricing to different customers. Dynamic pricing allows businesses to capture maximum revenue and respond to market changes quickly. However, implementing and managing dynamic pricing systems can be complex and require sophisticated technology.

Laura Georgi

“The power of CPQ in this scenario (Dynamic Pricing) – with the combination of sales data, an quotation data – especially quotes won and lost, we can unlock multiple revenue improvement opportunities in real time.” – Laura Georgi, customer success manager,

1. Proximity advantage – What is our cost advantage/disadvantage on a given job?
2. Buying patterns – What historical buying behavior does this client or contractor have?
3. What is our profitability in the area of the market?
4. How is my win/loss ratio trending, is the market going up or down?
5. Is my strategy yielding the desired results? Should I remain tier-based, or move to a market segment or product category approach?
6. How will this order impact my order pipeline or backlog?
7. Should I take into account this customer’s credit history?

Graphic 2. When you are creating a quote, you are attempting to forecast what your operational efficiencies will be in the future, when the quote becomes an order. In this example, informs the user about truck routing and costs, the number of trucks needed per day to fulfil the order and other information that can be used to optimize deliveries.

Analyzing the available data, we can adjust these variables and more to tailor our pricing the way we want it.

Choosing the right pricing strategy is crucial for aggregates businesses to thrive in a competitive market. Each strategy has its advantages and considerations, and companies must carefully evaluate their business model, target market, and customer preferences.

Whether it’s cost-plus, value-based, competitive, dynamic, or subscription-based pricing, Aggregates companies must continuously monitor and adapt their pricing strategies to meet evolving market dynamics and customer needs. By doing so, they can unleash the power of pricing and achieve sustainable growth and profitability in the aggregates landscape.

Accelerating Sales and Enhancing 
Customer Experience
Time is of the essence in the aggregates industry, where project deadlines and customer demands are often pressing. CPQ software such as enables sales teams to generate accurate quotes quickly, eliminating the need for manual calculations and paperwork.

With a streamlined quoting process, companies can respond to customer inquiries promptly, accelerating the sales cycle and gaining a competitive edge. Furthermore, CPQ solutions provide a seamless and intuitive user experience, simplifying the buying process for customers.

This enhanced experience leads to higher customer satisfaction, repeat business, and positive word-of-mouth referrals.

Driving Innovation and Adaptability
The aggregates industry is evolving rapidly, driven by advancements in technology, sustainability requirements, and changing market dynamics. CPQ software enables companies to adapt and innovate in this ever-changing landscape.

With the ability to easily modify product configurations, incorporate new materials, and adjust pricing strategies, businesses can stay ahead of the competition and meet evolving customer demands. CPQ empowers companies to embrace innovation, explore new market opportunities, and position themselves as leaders in the industry.

Graphic 3. When looking at your quote and sales activities in a tool like, it becomes very clear that the Competitive Pricing practice is often a fallacy.

In an industry as competitive and complex as aggregates, embracing CPQ technology is a game-changer. By automating and streamlining critical processes, personalizing solutions, optimizing pricing strategies, accelerating sales, and driving innovation, CPQ empowers companies to thrive in the face of challenges.

It’s time for the aggregates industry to unlock the power of CPQ and shape a future of efficiency profitability, and customer-centricity. Are you ready to revolutionize your business?

Barry Hudson, Laura Georgi and Oksana Verbetska are with

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