Cash-strapped companies rethink pricing options sense,” said Judy Babinski, a Florham Park-
based partner who is one of the four members
on the firm’s executive committee.
san Francisco-based senior vice president with “We’ve known for a long time that the hour-
More businesses offer discounts, promotional programs to win clients
Hildebrandt, a consulting firm that specializes ly billing model doesn’t always work,” she said.
By Martin C. Daks Corporate Strategy in the legal industry, which has its headquar- “in today’s economy, more clients are looking
Tough Times are driving insurance firms, ters in the somerset section of Franklin. “sole for alternative arrangements like project fees, or
pharmaceutical companies and other busi- for living and dying by billable hours, are being practitioners have long offered fixed-price bill- blended rate [where a single hourly fee is charged
nesses to rethink their pricing structures, driven to change by today’s economy. ings, but now the big firms are also getting regardless of the mix of higher-priced partners
industry experts say. as cash-pressed clients “There’s a growing interest in alternative pressured by their clients.” and lower-priced associates] billings. You have to
look for better deals, stepped-up competition PS11941_1.qxp 6/17/09 1:36 PM Page 1 Day Pitney LLP offers fixed-fee and “alter-
pricing models, including billing by the project look at different ways of doing things.” u
is nudging companies of all types and sizes to instead of by the hour,” said Blane Prescott, a native pricing arrangements whenever it makes E-mail to email@example.com
tinker with the way they bill for their services.
David Pagoumian, Napco LLC chief exec-
utive officer, knew his industry — catastrophic BUSINESS OWNERS ON HEALTH CARE SERIES: No. 2
insurance coverage — had been upended when
the down economy crowded out the weather as
a major pricing determinant.
“Last year was one of the more active hur-
ricane seasons, which would normally drive up
‘cat’ coverage premiums as insurers try to build
up their reserves,” said Pagoumian, who heads
“There’s a growing interest in
alternative pricing models,
including billing by the project
instead of by the hour.”
Blane Prescott, senior vice president of Hildebrandt
the wholesale insurance broker in the iselin sec-
tion of Woodbridge. “But the slow economy acted
as a brake, keeping premium hikes from taking
place, except with specific accounts where spe-
cific events warranted higher premiums.” Horizon Blue Cross Blue Shield of New Jersey interviews is most desired by our employee population. We then work
Pharmaceutical companies, long thought Adam Kraushaar, General Manager and Karin G. to find the best coverage to meet those needs at the least
to be recession-resistant, also are reviewing Kraushaar, Legal Counsel, Lester Glenn Auto Group.
expensive cost. Horizon gives us plenty of alternative plans
their pricing policies, according to a Princeton to consider and is competitive with its pricing.
Q: How is the economy affecting your business?
AK: This is an unbelievably interesting, scary, challenging Q: Anything else you like?
“We are currently working with a Ne