The Transparent Price Project at Liquigas
A focus on transparency, compliance and business integrity
At Liquigas, we have always focused on our client’s needs through transparency, compliance and business integrity. To help us do this, we implemented a pricing project in 2015 with help from high level consultants in order to enhance an equity system that would govern the final price for every client.
Increasing pricing transparency for our clients
In 2016, we decided to enhance our pricing transparency policy further by taking new material actions to ensure that we care for and treat our clients properly. This decision was also reinforced by the Indian Auto LPG Coalition (ICA), which believes that the LPG market still needs action to ease competition. We called it our Transparent Price Project, which would establish a transparent price policy and procedures to give our clients a clear and effective idea of how and why our price list changes.
Putting the client in the driver’s seat
The project has three specific goals. First, we separate our price list into specific components:
The LPG cost (FOB + freight + Dollar/Euro change + stock variation)
Other costs and commercial margins + VAT
Second, we give our customers information about which price component is changing, how much it is changing, and why. And third, we give our customer the ability to stop their supply contract at any time with no additional costs if component “c” rises higher than 5% compared to the last applied price.
Positive customer reactions
During 2017, we informed all customers about the project through direct mailing, direct leaflet distribution and our sales representatives. We have delivered the project to our customer Liter, and can now extend it to other selling channels in the small bulk market in 2019. General reaction has been positive, as confirmed by a recent customer survey. We’re confident that further project success will result in better relationships with customers and authorities, as well as increasingly enforceable contracts. And last but not least, it will enhance our company’s image and give us a competitive advantage as other companies lag behind us in implementing this approach.