Pricing is the lever most companies leave alone
Costs get reviewed every quarter and prices almost never. The finance team is well placed to change that.
Most companies I have worked in could say what they spent on software last month to the dollar. Fewer could say what their customers actually pay, after discounts, by product and by segment. Costs get a review every quarter. Prices get set once and then drift.
Start with what customers actually pay
The price list is rarely the price. A discount given to close one deal becomes the starting point for the next. Before changing anything, set the price each customer really pays next to the list price. The spread is usually wider than anyone expects, and it rarely tracks the size of the customer or the value they get.
One product, several prices
At a consumer products company I worked with, adding retail and wholesale to a direct-to-consumer business meant the same product carried several prices at once: on the website, on a store shelf, and through a partner. Each had to make sense on its own and next to the others. A price that works in one channel can quietly undercut another.
Why a small change is large
A price increase that holds carries almost no cost with it, so nearly all of it reaches profit. The same percentage gain in volume brings its cost of goods, its commissions, and its support load along. In a business with thin margins, one point of price can be worth several points of volume. Few companies divide their attention in that proportion.
Discounts are also information. Where they cluster, by product, by salesperson, or by week of the quarter, shows where the product is weak, where the selling is, and where customers have learned to wait.
Small, deliberate changes
Pricing work does not need to be dramatic. Tighten who can approve a discount and how deep it can go. Write an annual increase into the contract instead of negotiating one at every renewal. Try a new package with new customers before offering it to existing ones.
Why finance belongs in the conversation
Sales owns the customer relationship, and should. Finance holds the data on what each customer pays and what each one costs to serve. Pricing decisions made without that view tend to reward volume over margin.
Cost cutting has a floor. Better pricing has no equivalent limit, and the benefit arrives again every month.