Your Market View Is Incomplete

We are hearing this theme from business leaders more and more:

You have a strong handle on your markets, and you know your business’s capacity to capitalize on market expansion as well as its ability to mitigate a market downturn. 

Yet in recent months, you are finding yourself:

• Explaining why margins slipped on orders booked six months ago, even though revenue met your plan
• Renegotiating suppliers after the fact while locked into customer pricing that no longer fits your costs
• Winning work that looks strong on paper, only to see material and labor cost increases eat away at profitability

Pricing has become a more consequential piece of the puzzle this cycle, and if your business is struggling to price with confidence — without eroding margins on one side or alienating customers on the other — you are not alone.

Pricing Issues Pervade the Economy

In the data, nominal dollar growth is holding up in many sectors. Our marquee dataset for business-to-business spending, US Nondefense Capital Goods New Orders (excluding aircraft), is 3.5% above the year-ago level.

Adjusted for inflation, however, annual New Orders are essentially flat — just 0.3% above a year ago.

Your business may be experiencing something similar.

Getting a Handle on Your Pricing Environment

The challenge is not recognizing inflation; everyone sees it and feels it. The challenge is knowing how it will affect your business and having a reliable view of what comes next.

Most companies rely on a mix of internal data and broad indicators like CPI or PPI to guide pricing. But neither provides a complete picture. Internal data shows what has already happened, not what is coming. Broad indices reflect average conditions, but that is not your cost structure.

This is especially true in times like the present. Commodity volatility, supply chain disruptions, tariffs, and the like are leading to very different pricing environments between industries. Consider the following inflation rates:

• Overall producer prices: +1.7%
• Electrical machinery and equipment prices: +11.7%
• Plastic resins and materials prices: -5.0%

What is missing is a way to measure inflation as it actually applies to your business, and to see where it is headed over the next few years.

A custom price index with a reliable forecast can provide that view.

At ITR Economics, we construct that view using a wide range of data sources, aligned to your specific cost structure and supported by a highly accurate forecasting methodology refined over decades. The result is not just a snapshot of current inflation, but a forward-looking measure you can use to guide pricing and planning decisions.

With that visibility, you can:

• Quote with a clear view of where input costs are likely to trend over the life of the order
• Structure pricing and escalation terms to protect margins before volatility shows up
• Prioritize the right jobs — repricing or walking away from work that won’t hold margin under expected costs
• Adjust early as costs begin to move, rather than explaining margin erosion after the fact

With the power to price your products appropriately and plan confidently for future shifts, you will enjoy a competitive advantage with a lasting ROI. We can help get you there.