Highline Warren is a manufacturer and distributor for oil, chemicals, and consumable products in the aftermarket auto industry. With 20 nationwide manufacturing and distributing sites, 200 million gallons of oil manufactured annually. At Highline Warren, 2 companies have merged causing 40% of revenue to come from the distribution side and 60% to come through the manufacturing side.
Highline Warren partnered with PROS to solve a few critical challenges, including:
- 4 Different ERPs that were caused as a result of many acquisitions.
- High Volume of Products
- Monthly Price Changes
- Lack of Price Harmonization (across channels, brands, etc.)
- Lack of Analytical Insight into Pricing
With these challenges, PROS knew that Highline Warren needed AI-powered Pricing. Highline Warren created a feedback loop that starts with PROS Smart Price Optimization and the business rules, then the price recommendation is given to the sales team through various ERP’s, and then the data of the selected price is passed back to PROS to be taken into consideration for future pricing recommendations. This allows the Highline Warren team to easily understand and have visibility into how each price is set in each channel.
With PROS, Highline Warren has experienced great results, including:
- AI-Driven Pricing: PROS Price Optimization envelope provides Highline Warren with tailored AI-generated price recommendations for each product and customer.
- Improved Price Execution: Boosts seller confidence for more effective pricing strategies.
- Seamless Integration: Easy integration, unifies multiple ERPs.
- Enhanced Pricing Governance: Instills pricing discipline and intelligence for strategic consistency.
- Margin Insight: Offers visibility into margin leakage and identifies improvement opportunities.
To learn more about Highline Warren’s relationship with PROS, view the customer testimonial here. If you’re interested to see PROS in action in other industries, watch the full Outperform LIVE! session here.
Full Transcript
Hi. I’m Jorge Garza, strategic consultant here at PROS. And with me today, I’ve got Julia Brasher, director of pricing and revenue management at Highline Warren. So, Julia, why don’t you tell us a little bit about the challenges that you were facing at Highline Warren before you partner with PROS?
Yeah. Thanks, George, and good morning.
Highline Warren is a manufacturer and distributor for oil, chemicals, and just consumable products in the aftermarket auto industry.
So we have twenty national manufacturing and distribution sites.
We manufacture two hundred million gallons of oil annually.
And we are a product of acquisitions such that sixty percent of our revenue now flows through the manufacturing side. Forty percent of the revenue is through the, the distribution side.
We partnered with PROS to, so we had some business challenges.
And, when I was at Outperform last year, I was actually, not a customer yet. So we brought these business challenges to PROS.
We through the acquisitions, we became one company with four ERPs, none of which I would consider an an up to date ERP. They’re green screen, AS four hundreds, very old in technology.
Especially on the redistributed side, we have thousands of SKUs.
So high volume of products.
We deal with a lot of vendor cost changes.
You know, monthly price changes are the norm.
And because of so many ERPs that operated in silos with different SKUs, same customers, different customer numbers, things like that, we really lacked we lacked the price harmonization that we needed to see just across both channels and all of our brands.
And then, of course, because we were so siloed and all the ERPs, getting all that data, analyzing it was just it was just a lot of hard labor involved to do that.
So thanks, Julia. So to solve for these challenges, we built a solution that injected AI directly into Highline Warren’s pricing by leveraging PROS price optimization.
So these optimized prices were further refined and augmented using intelligent business rules.
Now with this consolidated system in place, PROS became the single source of pricing truth, seamlessly delivering pricing to Highline Warren’s existing ERPs and sales team. And by taking this approach, Highline Warren’s sales team could continue, in using interfaces that they were familiar with, and this ensured a smooth, change management process. So as Highline Warren continued to close more business, all that data, all that transactional information came back into PROS and provided Highline Warren, and their pricing team actionable insights into the analytics that help them gain visibility into the effectiveness of their different pricing strategies, margin leakage, and governance.
And so lastly, using that data, we fed that right back into the, PROS AI price optimization algorithm, and through machine learning, it continued to improve pricing. So this whole new pricing experience gives Highline Warren pricing and their selling teams what they really need to execute on winning pricing. Now we’re gonna take a closer look at all of these different pieces.
Now when it comes to price optimization, visibility and transparency is absolutely critical, and so PROS price optimization gives Julia and her pricing team a comprehensive overview and breakdown of the revenue and margin uplift that they could potentially, derive from their existing transactional data, which is what you see here. And so this is the UI that the Highline Warren pricing team would use to get, a better view or better visibility into the direction and magnitude of the price changes that PROS AI is recommending.
Now we’re gonna get more granular here, and what we’re seeing here is the that the PROS price optimization provides detailed insights into individual pricing recommendations.
So here you can see the floor, the target, and expert prices, as well as the win rate elasticity curve for every single unique transaction.
Now, this is gonna give Highline Warren and their pricing team visibility into how each of these tailored prices, and the recommendations are generated all through the same UI.
Now not only does PROS price optimization provide, what that pricing envelope looks like, it also precisely breaks down how different and discrete product, customer, and transactional attributes are going to influence price recommendations and that willingness to pay. So starting on the left here, you see a baseline price, and then as you move to the right, you can see the influence each attributes attribute will have on that final pricing.
And since PROS doesn’t use segmentation, for this algorithm, every single transaction is going to have its own unique set of attributes that influence that price.
The AI that’s the backbone of the solution is smart enough to see all of that nuance throughout Highline Warren’s entire dataset.
Now pricing doesn’t exist in a vacuum, so PROS price optimization, will give the context to the price recommendation by showing what other customers have paid for the same product under similar circumstances. Now this is gonna give Julia and her team the confidence that they need. These recommendations are aligned across their entire business.
Now everything that I just showed you is what Julia and her pricing team will use to get that visibility and transparency into how the AI is working and how how it’s processing, the pricing. All of that information is distilled into a pricing envelope that is seamlessly integrated into Highline Warren’s existing ERPs, as you see here, as shown in the yellow, on the bottom. And so what happens is Highline Warren’s, sellers now have a familiar tool that they’re working with, and they’ve got this intelligence being, fed into it, and now they can go and outperform.
So as Highline Warren continues to gain, and win more business, all of that data is fed right back into PROS, giving them the key insights into their optimization performance. So what this view is showing here is how the Highline Warren, pricing team or selling team is tracking to those recommendations.
So down at the bottom, you see the blue, and that’s showing you where the over discounting is taking place. So you can take action on those situations. The yellow section is showing you where pricing, is is being recommended around floor and target and transacted on. You’ve got the purple showing you transactions that are between floor and expert pricing. And then finally, orange is showing you all of that, above expert pricing.
So using this information, the Highlander warranty team is equipped with actionable insights into the performance of that AI driven pricing solution.
Now, what’s really cool is that the PROS platform also gives Highline Warren cross functional support across their entire organization, and it gives them a better picture of that gross to net pricing using this price waterfall.
So this can show you, for example, where is over discounting happening, How are you arriving at your current margins? And that way, PROS breaks this information down into a way that’s digestible and usable by different functions, such as your finance teams, CFOs. They have all that information that they need to make better informed pricing decisions.
And lastly, PROS provides insights into period over period margin driver performance. So this is allowing the pricing team to really hone in on what’s driving that margin leakage. So Hyland and Warren has what they need to be proactive with their pricing decisions, for from all the way from the most granular detail all the way up to the most comprehensive view. And, so, Julia, what kind of impact, did PROS have on Highline Warren when you partnered with us?
Yeah. It’s it’s been a great, powerful impact. We’ve been live since February, and we’ve already seen some dramatic changes within the business.
We do have Gen four, so we have the AI driven pricing, which our sellers have adopted.
The pricing team was skeptical at first, and we did a proof of pricing project where we researched prices that were coming from guidance against our year over year average sale prices, looking at customer product specific analysis to be fair to the guidance, and also looking at competitive market data and just seeing, just trying to predict, okay, are the sellers gonna adopt this? Are they gonna have buy in with this?
We have improved price execution.
So did they have buy in? They they did. We brought them along side by side. I I started with six sellers who I just partnered with and checked in regularly, took their feedback, listened to it, made action, and they really became the advocates for the rest of our sellers to come, into PROS and adopt the guidance.
We we had a seamless integration. You saw the screen grab of what our order entry looks like.
But I do have to say that that seamless integration, I had I had very low expectations that it was gonna go well, And I really have to credit the PROS team for not only not only the hard work that they did, but the advice they provided, the the guidance they provided to ensure we were making the right decisions from a technology standpoint so that hopefully in the future, when we do improve our ERP, we can just plug and go and not miss a beat when it comes to pricing execution.
It’s been an enhanced, pricing governance. We still allow overrides, as we have a lot of transactional data.
The sellers move very quickly through a lot of rows of data, and we do allow hand key overrides. But what we’re seeing is that as time progresses and they stay and keep using Gen four, they’re really sticking to that target price.
And they they’re adopting it. And they are also complimented because they’ll say that, yeah, Target was what I thought it would be. You know? The pricing team has finally done something right. And, so we’ve had some great feedback from them, thanks to Froze.
But, and lastly, just the margin insight. You know, we’re still really new into the implementation, so I’m not gonna, I would it’d be unfair to say that we’re actively using all of those graphs that, that George just showed, but we do we’d access look at them. We’d not we’re still trying to understand them and make sure that, you know, who gets these? What are we gonna do with these? But we do have some great margin margin KPIs that we’re already showing the sales managers so that they can see which sellers have really adopted it, where does it where does it really work in certain product categories.
And, and so we it’s really exciting to see where we were last year at Outperform and where we are this year.
So thank you, George.
Yep. And thank you, Julia, for sharing that story with us. And I wanna thank Highline Warren and your team for partnering with PROS and, letting us tackle those challenges for you.