topic: simulation model for excise change
area : FMCG, legislation, taxation, price strategy
For a FMCG company we compiled a simulation model that calculated what-if scenarios on possible excise changes (due to legislation). The simulation model included many KPI's and parameters that could be changed on the fly and resulted in possible SKU price ranges. Based on that, the client was able to prepare for worst case scenarios but was also able to establish a pricing strategy and pricing model specifically in combination with competition data. This simulation model saved many man hours due to the very complex calculations of applying excise to certain SKU ranges and calculating possible scenarios that would not have been possible otherwise. It helped the client in the end to retain a competitive edge towards their main competition in certain product ranges.