Client Overview‍

RBM Plastics is an Australian-owned manufacturer of PVC compounds, supplying a range of industries including electrical, telecommunications, construction, and industrial manufacturing. Known for its responsiveness, technical capability, and family-run agility, RBM had developed a strategic relationship with Prysmian Group—a global cable manufacturer requiring high-spec compound performance.

Challenge / Problem

‍Prysmian’s procurement team initiated discussions with RBM requesting price reductions in exchange for increased volume. The alternative presented was the threat of contract loss to lower-cost competitors. This placed RBM in a familiar squeeze: defend margins or lose a significant account. The negotiation took place in the context of a maturing supply relationship, new leadership at Prysmian, and increasing price pressure across the market.

Symptoms Observed

• Procurement demands for lower pricing without recognising supply risk mitigation, flexibility, or prior technical support.
• Threats of volume reallocation to low-cost VIC-based suppliers, despite those suppliers’ inferior quality history.
• No formal contract in place to lock in terms, despite a long term and strategic high value relationship.
• RBM had already invested $millions into new production lines based on Prysmian’s projected volumes.
• Commercial conversations focused solely on invoice price, ignoring total economic value delivered.

Strategic Impact

Without intervention, RBM risked significant margin erosion or outright loss of a foundational account. Worse, caving to price cuts could set a precedent that undermined the economics of serving other large customers. The situation also threatened to commoditise RBM’s offer despite its technical differentiation, strategic supply reliability, and value-added services.

Internal Viewpoint

RBM management was deeply concerned that procurement’s tactics were sidelining the broader value of the partnership. They were aware that RBM’s compounds were the only ones to pass internal Prysmian testing on specific grades. They also knew from past incidents that no other supplier could match RBM’s ability to meet urgent orders or solve quality problems quickly. However, they lacked a structured negotiation framework and supporting data to defend their price.

Objectives of the Engagement

• Identify and quantify the full value RBM delivered to Prysmian beyond product pricing.
• Develop a structured negotiation strategy that reframed the commercial conversation around value and risk mitigation.
• Strengthen RBM’s pricing power by formalising service levels, flexibility, and technical support into the offer structure.
• Preserve and grow the account while avoiding unprofitable volume.

Our Approach

Phase 1: Situation Diagnostic
We conducted stakeholder interviews and reviewed internal correspondence, commercial data, and operational history. We assessed the total account value, future potential, and risk exposures. The team identified a strategic misalignment between value delivered and how procurement evaluated RBM’s proposal.

Phase 2: Customer Value Mapping
Using our Customer Value Discovery methodology, we facilitated a workshop to capture all tangible and intangible benefits provided by RBM. These included uptime guarantees, technical agility in formulation testing, onsite support for quality assurance, fast delivery, flexible stockholding, and the ability to dial production up or down with minimal notice. The economic impact of avoiding Prysmian’s downtime—up to $1 million per day—was modelled to quantify the true value at risk.

Phase 3: Strategic Pricing and Negotiation Planning
We developed a negotiation strategy that separated invoice price from total value delivered. Commercial options were structured with tiered pricing, volume thresholds, and conditional benefits tied to forecasting accuracy, packaging returns and technical collaboration. We also coached the RBM team on how to reframe procurement’s cost-cutting narrative by equipping them with economic value models that procurement could use internally.

Key Actions Taken

1. Facilitated a half-day Customer Value Discovery workshop with RBM leadership focused on Prysmian.
2. Produced a customer value canvas highlighting over 20 specific value drivers and quantified impacts.
3. Developed strategic offers with multiple price-volume-service options tailored to different internal stakeholders.
4. Designed risk mitigation clauses and performance guarantees to support higher price points.
5. Supported pre-negotiation coaching sessions to align internal messaging and rehearse procurement counter-moves.

Results Achieved (Within 12 Weeks)

1. Higher average selling prices than the prior year were secured.
2. Prysmian agreed to increased volume commitments with clearer forward planning.
3. RBM’s role as a critical partner—not just a supplier—was formally acknowledged.
4. RBM avoided unnecessary price concessions and strengthened its long-term contract posture.

Client Feedback

"Pricing Insight helped us reframe the conversation from discounts and procurement pressure to value, performance, and continuity. We walked away with a better deal and a stronger relationship."
— Tony McWilliam, Managing Director, RBM Plastics

What This Means for Similar Companies

For industrial manufacturers supplying strategic inputs into complex customer operations, pricing is never just about the invoice. Procurement may focus on short-term cost, but operational leaders care about reliability, responsiveness, and avoiding risk. By clearly articulating and quantifying these drivers, suppliers like RBM can defend—and even grow—margin in the face of aggressive buyer tactics. This approach is especially critical when large capital investments and long-term supply relationships are at stake.

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