The detailed review established the actual costs of delivering each product based on the hourly rate of employing each member of staff delivering that service, productivity rates, the cost of pathology tests and other services included within prices, the cost of disposables per patient.
Once a spreadsheet showing all the relevant costs for each service had been created the existing prices were reviewed in terms of profitability and competitor pricing and Sarah made recommendations to the Executive Team for changes. She was also able to show those involved in sales what level of discount could be offered without compromising profitability. Prices were then reviewed annually thereafter and the spreadsheet was used to price one off services.
The outcome was improved profitability and provided a sound basis on which to set prices following the purchase of Finsbury Healthcare. (See Integrating an Acquisition for further details)