Business Case: Traditional Pricing vs AI-Driven Dynamic Pricing
Industrial Gases • EBITDA impact in % and € (board-ready)
Power Executive Summary
- AI Dynamic Pricing raises realized price, reduces leakage, and improves mix with controlled volume effect.
- Total EBITDA Impact: +€10.86m (+12.1%) vs baseline; +€13.21m (+15.1%) vs traditional.
- Program costs included in AI scenario (Opex +€2.0m) → still net accretive.
Baseline
Revenue €600m
EBITDA €90m (15%)
Traditional Pricing
Price +0.5% • Leakage 2.0% • Mix 0.0% • Volume +0.2%
COGS 70% • Opex €90m
AI Dynamic Pricing
Price +2.2% • Leakage -1.2% • Mix +0.6% • Volume -0.3%
COGS 69% • Opex €92m (incl. program)
Traditional Pricing
Realized effects: modest price ↑, leakage persists
Revenue
€ 592.18m
COGS
€ 414.53m
Opex
€ 90.00m
EBITDA
€ 87.65m (14.8%)
AI Dynamic Pricing
Higher realized price, lower leakage, better mix
Revenue
€ 622.13m
COGS
€ 429.27m
Opex
€ 92.00m
EBITDA
€ 100.86m (16.2%)
Total EBITDA Impact
AI vs Traditional: € 13.21m (+15.1%)
AI vs Baseline: € 10.86m (+12.1%)
Program Cost (incl. in AI Opex)
€ 2.0m → ROI ≈ 6.6× vs Traditional
Driver Breakdown (Realized Pricing)
| Driver | Traditional | AI Dynamic Pricing | Comment |
|---|---|---|---|
| Price Uplift | +0.5% | +2.2% | Elasticity guardrails by segment |
| Discount/Leakage | -2.0% | -1.2% (reduction) | Approval workflow & guardrails |
| Mix Effect | 0.0% | +0.6% | Prefer higher-margin SKUs/routes |
| Volume Change | +0.2% | -0.3% | Slight tactical giveback to protect key accounts |
Power Decision Request
- Approve AI Dynamic Pricing rollout (100-day playbook, 12–18 month scale-up).
- Launch 3 pilots: bulk gases (tiered segments), cylinder gases (contract guardrails), onsite (indexation).
- Set ROCE governance: monthly value tracking, risk & compliance checks, board updates.
