Following an extensive selection process, Hagebau has chosen the price optimisation solution from French specialist Mercio. The building materials and DIY cooperative will use the platform to optimise both its price image and profitability. The solution’s high level of automation will also enable Hagebau’s head office to create price proposals for its retail partners more efficiently.
Hagebau chose Mercio in part because of its modern, easy-to-use user interface and the transparency of the solution. The technology provider also impressed the group with its ability to simulate the impact of price changes on key figures and to monitor the results after their implementation in stores.
”We liked the fact that Mercio’s platform presents its calculation logic in a comprehensible way,” explains Dennis Dreier, Head of Project and Process Management, Promotion Control and Pricing at Hagebau. Hagebau must always be able to explain to the group’s shareholders, who operate the markets, why the head office proposes certain price changes. Solutions that generate prices from a black box are not suitable for the retailer.
Mercio has expertise in the DIY-Segment
Mercio has extensive experience in the DIY sector and has understood Hagebau’s pricing strategy and specific requirements right from the start, reports Dennis Dreier. In the past, the retailer used to create price proposals manually in Excel, focusing on competitors’ prices. “However, this repeatedly led to breaks in the pricing logic,” explains Dennis Dreier.
With Mercio, Hagebau is now tackling this challenge head on: Mercio, which is based on AI, will help the group to define product families and the relationships between items – and that with the huge number of 500,000 SKUs that the retailer offers. “Not only the number of products, but also the interdependencies between items are much greater in the DIY store segment than in grocery retailing,” explains Dennis Dreier. Mercio has proven to French DIY store operators that the solution can handle the complexity of the segment.
Implementation has already started
Hagebau has already taken the first steps by integrating the Mercio solution, which is entirely cloud-based, into its own processes. The group plans to go live with it as early as in June. Over the next few years, Hagebau plans to gradually implement other modules from the platform.
“Mercio will enable us to offer our customers an attractive, always logical and consistent pricing structure,” says Dennis Dreier. This has the potential to significantly increase both the sales and profitability of the stores.
Mercio plans further expansion in Germany
Mercio’s success in France has motivated the company to begin its international expansion in Germany. “Germany is a challenging retail market, but one that is sufficiently developed for the use of the latest generation of technologies. The trust that Hagebau has placed in us confirms our view of the market,” explains Valentine Dreyfuss, Founder and Managing Director of Mercio.
