Pricing logic
Pricing logic is the governing rule set that determines what any given customer pays, as distinct from a price list, which is only its output.
Pricing logic answers the structural questions: what is the unit of value being charged for, how does price scale with that unit, what discretion do sellers have, what approval thresholds apply, and how do prices change over a contract term. A price list without this logic is a snapshot that erodes the moment a deal needs an exception.
Because pricing logic determines realized revenue per unit, it is upstream of unit economics, forecast accuracy, and expansion modeling. A discount policy is not a sales concession process; it is a modification to the revenue architecture, and treating it as such is what makes margins predictable.
Where it breaks
Discount approval exists as a workflow but not as a policy, so realized price drifts away from list with no one owning the drift.
Related terms
- Unit economics
- Unit economics is the per-unit relationship between what it costs to acquire and serve a customer and what that customer returns over their lifetime.
- Unit Map
- The Unit Map distinguishes how the customer evaluates benefit, how price is calculated, what is billed, what the customer may access, and what drives delivery work.
- Price realisation
- Price realisation is the net commercial amount on a declared basis after applicable discounts, credits, and concessions, divided by the relevant pricing or billing quantity when useful.
- Discount policy
- A discount policy states what a discount is exchanged for, who may grant which magnitude, and what the concession costs the company, as distinct from an approval workflow, which only routes the request.
Field notes on this
- Your pricing is a list, not a logic
A price list says what things cost today. It cannot say what to charge the deal in front of you, which is why realised price drifts and nobody owns the drift.