Pricing ownership, data and alignment

Nobody owns pricing and the data can't be trusted

Pricing decisions fall between sales, finance and marketing. Quotes live in spreadsheets, and the margin report never quite agrees with the invoice.

Read on ↓

1
What is changing
Price is decided thousands of times a week by dozens of people under pressure from customers. As ranges, channels and customer numbers grow, informal rules stop working.
Boards and owners want evidence that margin is managed, and finance is asked to explain price movements it did not decide.
2
Common signs
- Every function has a view on price and nobody is accountable for the result.
- Quotes, price lists and rebates are managed in Excel, outside the ERP.
- Margin, rebate and discount data arrives too late or too unreliable to act on.
- Commission is paid on revenue, so reps optimise for volume.
- Previous pricing projects found the margin and then lost it.
- Leadership has not set clear expectations on pricing discipline.
3
Where it leads if left alone
With no owner, each person makes a reasonable local decision. No one planned the result, and no one is accountable for correcting it.
4
The decision that is hard to reverse
Funding a pricing project without changing who owns price is the costly decision. The margin is found and reported, then lost within a year as old habits return.
5
What recovery costs
Rebuilding trust in pricing data and decisions takes time: cleaning price files, agreeing one source of truth and resetting decision rights. Each failed project makes the next one harder to start.
6
What good looks like
- One accountable owner for each type of pricing decision.
- A Pricing Council with a written charter, chaired by the CFO or general manager.
- A monthly gross-to-net margin waterfall by customer and SKU.
- Commission and targets that reward margin as well as volume.
7
What it is worth
Governance holds the gains from the other work in place. Arnott's centralised pricing and recovered over A$5m of EBIT within 12 months (realised).
8
How it is treated
1. Score capability against the evidence. The 9PE scorecard sets your starting level on a five-level maturity scale and compares staff views with the evidence. Strategic EBIT Opportunity & Risk Diagnostic →
2. Name owners and decision rights. A decision-rights chart, a discount authority matrix and a Pricing Council with a written charter. Value-Based Culture & Transformation →
3. Fix the data that drives decisions. A monthly gross-to-net margin waterfall by customer and SKU, and a single source of truth for list price. Value-Based Culture & Transformation →
9
How Pricing Insight works
Relevant work: Staples set up a pricing function and realised A$6.8m of EBITDA within 12 months on A$80m of addressable revenue.
Experience
Ron Wood has worked in pricing for 30 years: first as a pricing and commercial manager in FMCG, building materials and capital equipment, and since 2007 as adviser to more than 160 businesses.
Method
Each engagement follows the same sequence: diagnose, optimise, embed. Recommendations rest on the client's own transaction data, and every figure can be traced to it.
Measurement
Results are measured against a margin baseline agreed with the client's finance team, and reported as realised, modelled or identified.
Continuity
Ron Wood leads each engagement from the first meeting to handover.
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Who in your business is accountable for the price on your largest account?
A first conversation establishes how this applies in your business and whether a diagnostic is warranted.
Make an enquiry