Start with a reconciled sales population
A price increase changes the price list. What a business earns also depends on the discounts salespeople grant, the rebates customers earn and the costs included in each agreement. Those items often sit in different systems. A pricing review needs to connect them before management can judge an account or a product family. Start by defining the period, legal entities and currencies covered, then reconcile the selected invoice population to reported revenue.
Use invoice lines as the starting point where they are available. Retain customer and product identifiers, quantities, units of measure, currency, credit notes and the original transaction date. Separate returns and corrections from new sales. An apparent fall in price can reflect a different pack size, product specification or sales mix. Comparing average selling prices before resolving those differences can send the commercial team toward the wrong accounts.
Build the price waterfall
For each transaction, trace the movement from the reference price to the amount retained. The waterfall may include invoice discounts, retrospective rebates, promotional allowances, free goods and customer-specific freight. Payment terms can introduce a financing cost. Agree which elements belong in net revenue and which belong in cost to serve, then use that treatment consistently. Otherwise the same concession may disappear from the analysis or appear twice.
A rebate accrual deserves particular attention. The invoice system may show the standard selling price even when the customer is close to an annual volume threshold. Match the agreement, accrual and subsequent credit where possible. Mark estimated allocations clearly. A report that assigns every rebate evenly across products can conceal the specific items that earned it, especially when the agreement covers only part of the customer's purchases.
Compare transactions with similar commercial terms
Group transactions by the factors that explain the offer: product, order size, delivery requirement, geography and channel. Account profitability and price realization answer different questions. A customer receiving a large discount may place predictable full-load orders; another may pay the list price while requiring expensive small deliveries. Show both views and let the commercial owner examine the underlying contracts before suggesting changes.
Investigate exceptions with sales and finance together. A credit that looks discretionary may settle a quality claim. A low realized price may be part of a package agreement with another product. Record the reason, supporting document and person who can confirm it. Unexplained exceptions remain a separate category until checked. Treating them as recoverable revenue would put an unsupported assumption into the budget.
Translate findings into commercial action
Possible actions include correcting an expired rebate, changing discount approval limits, revising delivery terms or setting a minimum order quantity. Each action needs an affected customer population, a contractual review and a view of likely customer response. Model the effect on volume and contribution as well as price. A price increase that causes an account to leave can also leave capacity or delivery costs behind.
Keep the original reconciliation when the revised terms take effect. Compare subsequent transactions against the agreed baseline and explain movements in mix, currency and input costs separately. Finance should be able to trace the reported improvement to invoices, credits and accruals. Where the expected change has yet to reach a signed agreement or a paid transaction, show it as pending rather than counting it as earned margin.