Pricing for Margin, Not for Volume
How to audit your pricing, find the margin you are leaving on the table, and raise prices without losing your best customers
Who this is for
SMEs where pricing is set by convention, competitor benchmarking, or gut feel — and where the last formal pricing review was more than 18 months ago.
What it costs you to ignore it
The diagnosis behind it
This playbook is triggered by a Red or Critical finding on:
Vital 1 — Strategy & DirectionThe Protocol
Pull your last 12 months of invoices. Segment by customer and by product/service line. Calculate the actual margin (not list margin) for each segment.
Identify your bottom 20% of customers by margin — not by revenue. These are the customers you are effectively subsidising. List them.
For each bottom-margin customer, determine the cause: excessive discounting, high service cost, payment terms, or scope creep. Categorise each.
Design a price correction plan for the bottom 20%: price increase, scope reduction, or exit. Set a 90-day timeline. Do not attempt all at once.
For your top 20% of customers by margin, test whether a 5–8% price increase is viable — through a direct conversation, not an assumption. Frame it around value delivered, not cost inflation.
Implement changes, track margin by segment monthly for the next quarter, and review the pricing policy at least once every 12 months going forward
What you can do yourself vs what needs help
The analysis in Steps 1–4 is entirely internal. Steps 5–6 — the customer conversations and implementation — are also internal, but benefit from a pricing framework and negotiation preparation that an advisor can provide in a single session.