Skip to content
All insights
PricingMay 19, 20267 min read

Pricing reset: how a 2-hour exercise lifted one client's gross margin by 18%

Most SMEs price by gut, competitor reflex, or the cost-plus calculator the CFO built in 2017. Two hours of structured thinking can change everything.

The setup

The client is a B2B services firm — 30 staff, eight years old, decent reputation, growing 12% a year. Their CFO had built a pricing spreadsheet in 2017. It was based on hourly cost-plus. Nobody had revisited it.

We ran a 2-hour pricing workshop with the GM, head of sales, and the CFO. The exercise had three steps.

Step 1: Map willingness to pay against value delivered

We took their 12 active service lines and plotted each one on a 2×2:

  • Horizontal: how strategic is this for the client (low ↔ high)
  • Vertical: how differentiated is our delivery (commodity ↔ unique)

Result: four of twelve services were in the top-right (strategic + differentiated) and priced like commodities. Three were in the bottom-left (low value, undifferentiated) and priced like premiums. The pricing logic was inverted for half the portfolio.

Step 2: Anchor pricing to outcomes, not hours

For the top-right services, we rewrote the proposal templates. Old: "160 hours @ $X/hr = $Y". New: "Outcome: 40% efficiency lift. Investment: $Z. Payback: 6 months." Same dollar amount, completely different conversation.

Clients stopped negotiating the rate. They started negotiating the scope of the outcome.

Step 3: Kill or repackage the bottom-left

Three services were costing money to deliver and embarrassing to charge for. We killed two and repackaged one as a self-serve toolkit (one-time license, no labor).

The result

Six months later:

  • Average deal size: +35%
  • Gross margin: +18 points
  • Sales cycle: -2 weeks (clearer value framing closed faster)
  • Win rate: unchanged (they didn't lose deals — they just charged more for the ones they won)

The workshop was 2 hours of leadership time plus 10 hours of follow-up documentation. The payoff was structural.

What this requires

This only works if leadership can be honest about which services are actually differentiated. Most can't, because they're emotionally attached to legacy offerings. The 2×2 is harder than it looks — but the conversation alone is worth the engagement.