Manual vs. Automated Price Adjustment: Which Is Better for Your Business?

In the competitive world of e-commerce, pricing plays a crucial role in determining the success of a business. Companies must constantly adjust their prices to stay competitive, maximise profit margins, and meet customer expectations. The two primary approaches to price management are manual price adjustment and automated price adjustment through repricing software. Each method has its advantages and challenges, but which is the better choice for your business? In this blog post, we’ll explore both methods and compare their benefits and drawbacks to help you make an informed decision.

What Is Manual Price Adjustment?

Manual price adjustment refers to the process of changing prices by hand, typically through an online seller account or back-end system. This involves monitoring competitors' prices, market trends, and other factors that may influence pricing decisions. Sellers make price changes at regular intervals, based on their observations or through strategic decisions made internally.

Benefits of Manual Price Adjustment:

1. Complete Control: Manual adjustments allow businesses to have complete control over their pricing strategy. Sellers can make real-time decisions based on factors such as stock levels, promotional events, and competitor pricing.
2. Customisation: With manual pricing, sellers can make highly tailored adjustments. For instance, they might choose to lower prices temporarily to clear inventory or raise them during high-demand periods.
3. Flexibility: Manual repricing gives businesses the ability to react quickly to sudden market changes or promotions. If a competitor lowers their price or there’s an urgent need to alter pricing, it can be done immediately.

Drawbacks of Manual Price Adjustment:

1. Time-Consuming: The process of monitoring prices and manually adjusting them can be very time-consuming. For businesses with large product catalogues or multiple marketplaces, this can quickly become a full-time job.
2. Human Error: Manual pricing is prone to errors. A misplaced decimal or missed update can lead to significant losses or pricing inconsistencies that can damage your reputation.
3. Lack of Scalability: As your product range or sales volume grows, manual pricing becomes increasingly difficult to manage effectively. What works for a small number of products can quickly become unmanageable as your business expands.

What Is Automated Price Adjustment?

Automated price adjustment, or repricing, is the process of using repricing software to adjust product prices based on a set of predefined rules or algorithms. Repricers monitor competitors' pricing in real-time and adjust prices automatically to maintain competitiveness, improve margins, or optimise sales.

Benefits of Automated Price Adjustment:

1. Efficiency: Repricing software streamlines the entire pricing process. Once the system is set up with rules or strategies, it operates autonomously, saving you time and effort. This is especially advantageous for businesses managing large inventories or selling on multiple platforms.
2. Accuracy: Repricers eliminate human error by using data-driven algorithms to make pricing decisions. The system can constantly monitor market fluctuations and adjust prices accurately without the risk of overlooking important changes.
3. Scalability: Automated pricing is highly scalable. Whether you have ten products or ten thousand, repricing software can handle the load without additional manual effort, making it ideal for growing businesses.
4. Competitiveness: Repricing software enables businesses to react faster to competitor price changes. This agility can give sellers an edge in highly competitive markets, helping them win the Buy Box on platforms like Amazon or remain attractive to customers.
5. Customisable Strategies: Modern repricers allow businesses to set complex pricing rules based on cost, desired margin, competitor prices, and other factors. You can even program the software to adjust prices based on inventory levels, ensuring you maximise profits during peak demand periods.

Drawbacks of Automated Price Adjustment:

1. Initial Setup: Setting up a repricer and determining the optimal pricing strategy can take time and effort. Businesses must understand how the software works and tailor it to their specific needs, which can be complex.
2. Over-Reliance on Algorithms: Automated systems are only as good as the rules and data they are fed. If the pricing rules are not properly configured, the repricer could adjust prices in ways that are counterproductive, such as underpricing a product too much or overpricing it.
3. Cost: Repricing software typically comes with subscription fees, which can add up for small businesses or those just starting out. However, this cost is often outweighed by the time saved and the potential for increased sales and profit.

Manual or Automated: Which Is Better?

The choice between manual and automated price adjustment ultimately depends on the size and needs of your business.

• Manual Pricing may still be a good choice for small businesses with limited product ranges or those operating in niche markets where price changes are rare or infrequent. It allows for complete control and flexibility, especially if your team is small and capable of managing pricing manually.
• Automated Pricing, on the other hand, is often the best choice for businesses that sell on multiple platforms, manage a large inventory, or are operating in competitive markets. The efficiency, scalability, and accuracy of repricing software can significantly improve profitability and free up valuable time to focus on other aspects of your business.

Conclusion

Both manual and automated price adjustment have their merits, but for many modern businesses, the advantages of repricing software outweigh the challenges of manual pricing. The ability to quickly and accurately adjust prices in real-time ensures that your business stays competitive, maximises margins, and can scale effectively as you grow.

If you’re looking to optimise your pricing strategy, investing in a high-quality repricer can make a world of difference. With the right system in place, you can boost sales, improve operational efficiency, and ensure your pricing stays in line with market trends.

‍

If you have any questions about our blog posts, our repricing software, or our consulting solutions, feel free to contact us at:
Email: support@metaprice.de
Phone: +44 20 45864545
WhatsApp: +44 7587 320494

For our free trial accounts:
Free trial account for our Amazon Repricer
Free trial account for our eBay Repricer

‍