Adelaide Brighton: connecting pricing strategy with customer value

The challenge

Adelaide Brighton wanted to strengthen its approach to pricing, protect margins and develop a clearer understanding of the value its businesses created for customers. The task was to connect pricing capability, commercial decision-making and customer value across different operating environments.

The group, now known as Adbri, supplies construction materials including cement, lime, concrete, aggregates and concrete products. The Pricing Insight engagement focused on the Cement & Lime division and the Concrete Products business, including Adbri Masonry.

The work needed to recognise the differences between these businesses while establishing a shared approach to value-based pricing. A product’s supply price was only one part of the discussion: service, delivery, technical expertise and the risks avoided by customers also needed to be considered.

The business context

Adelaide Brighton’s operations extended well beyond ready-mixed concrete: its 2016 annual reporting described the manufacture and distribution of cement, cementitious materials, lime, aggregates, sand and concrete products (2016 Directors’ Report). Its products served residential and non-residential construction, engineering construction, alumina production and mining, creating a broad range of customer requirements (2017 Directors’ Report).

The commercial conditions also varied across the group: the 2016 report described strong eastern-state construction activity and improving South Australian demand, alongside weaker cement demand in Western Australia and the Northern Territory (2016 Directors’ Report). The following year’s report highlighted energy-cost pressures, import competition in lime and weaker multi-residential demand affecting Concrete Products (2017 Directors’ Report).

This context helps explain the relevance of a shared pricing framework with division-specific priorities, rather than a uniform approach to every product or customer. The workshops provided a way to examine those priorities through customer value, commercial agreements and the practical operation of pricing.

Diagnosing pricing capability across two divisions

Pricing Insight used its structured diagnostic framework to examine pricing through three connected areas: Value, People and Structures. The review brought together staff assessments, written commentary and an evaluation of how pricing decisions were made.

The diagnostic covered customer value, pricing strategy, customer agreements, management alignment, pricing responsibilities, sales and negotiation, analytical methods, systems and price structures. This gave each team a practical basis for discussing its priorities rather than treating pricing as an isolated sales activity.

For Cement & Lime, the diagnostic informed a Revenue, Pricing & Profit Intensive workshop in Adelaide on 6 December 2016. A second diagnostic and workshop program followed for the Concrete Products/Adbri Masonry business in Sydney on 21 June 2017.

Turning the findings into a strategic plan

The workshops used Pricing Insight’s diagnostic and Customer Value canvases to turn the findings into working discussions. Teams identified issues and opportunities, explored customer value and developed priorities for management attention.

The commercial themes included:

• Customer value: understanding the benefits customers received and the operational risks the business helped them avoid.
• Pricing strategy: connecting market positioning and customer needs with clearer pricing decisions and responsibilities.
• Customer agreements: making the value provided more explicit in commercial discussions and contract reviews.
• Sales and negotiation: moving the conversation beyond product price towards the customer’s commercial outcomes.
• Pricing operations: improving the supporting information, systems and coordination needed to manage pricing consistently.

The work was documented in workshop reports, diagnostic scorecards and priority plans. These provided a practical basis for deciding what to address first, who should be involved and how to develop the approach over time.

Bringing Customer Value Discovery to the leadership team

On 31 May 2017, Ron Wood delivered a Customer Value Discovery session at Adelaide Brighton’s management conference at the Novotel Barossa Valley. This extended the discussion beyond the divisional workshops to the group’s wider leadership team.

The session addressed how to avoid treating differentiated products and services as commodities. Leaders were asked to consider both “value in use”, the benefits customers gained, and “value at risk”, the costs and disruption they could avoid.

Participants prepared examples from their own business and used the Customer Value Canvas to examine what mattered to customers, how well the business delivered it and where further opportunities existed. This made the session specific to Adelaide Brighton’s commercial environment rather than a generic presentation on pricing.

The contribution

Pricing Insight connected divisional diagnostic work, practical strategy development and leadership education within one engagement. The resulting reports and priority plans gave management a structured basis for strengthening pricing capability and making customer value more explicit in commercial decisions.

The case demonstrates the role of a shared pricing framework without assuming that every division needs the same strategy. The focus was on helping each business understand its sources of value and translate that understanding into clear commercial priorities.

Discuss your pricing priorities

Pricing Insight helps leadership teams connect pricing diagnostics, customer value and commercial strategy. Contact Pricing Insight to discuss a program for your business or divisions.

Explore our strategic pricing diagnostic and revenue, pricing and margin strategy service.

By Ron Wood, Pricing Insight. Photography: Adbri cement and Adbri masonry.