Business intelligence model for analyzing and optimizing the value-added service of a logistics operator

Amel Kosovac, Mirza Berković, Ermin Muharemović, Muhamed Begović

Last modified: 2020-03-04

Abstract


The pricing policy is one of the most important marketing elements of any company in today's market. It is quite easy to assemble all the parameters that make up the price of the service, but the problem always arises when setting the exit price. Taking into account the complexity of pricing added value logistics services in a highly dynamic market, we can conclude that the modeling results and their analysis enable companies to anticipate market demands for a particular logistics service, develop pricing and promotion strategies, and thus more successfully meet customer needs and desires. Modeling as a Business Intelligence Principle provides the ability to show different variants of a solution. This paper proposes a model designed to select the optimal price for an additional logistics service. The model is compiled in Java environment and it shows the optimal solution of the set function.The paper presents the "Price Optimization Models" application tool that calculates the correlation between user requirements for a particular one logistics service against different price levels where it combines these data with cost information and the status of logistics services to ultimately make a recommendation on the cost of the service that will maximize profits. This model allows the logistics company to use pricing policy as a tool to "level" profits. The model can be used to create pricing for individual user segments by simulating the reaction of targeted users and measuring their reactions through data-driven scenarios.

Keywords


model;price;service;value-added service;Business Intelligence;optimization;logistic