The list price is £2,400. The invoices range from £1,150 to £2,400.

Most businesses know their list price. Far fewer know the distribution of what they are actually paid, and the shape of that distribution is diagnostic.

By Steve 5 min read
Abstract bridge artwork for The list price is £2,400. The invoices range from £1,150 to £2,400.

A pricing review usually starts with the list price and the average selling price. Those two numbers can sit comfortably close together while concealing something far more interesting: the spread. Sort every invoice for the same scope of work from lowest to highest, and the picture is rarely a tight cluster. It is a long tail to the left, and the tail is where the margin went. The average tells you almost nothing about how pricing decisions are actually being made. The distribution tells you a great deal. Not all…

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Important: General information only. Rialto Bridge articles describe patterns and considerations that may apply to a business; they are not financial, legal, tax or accounting advice, and they take no account of your particular circumstances. Consider your own situation and seek advice from a qualified professional before acting.

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