Cards on the Table: The Business Case for Pricing Transparency

Splitting Up The Pie

I recently listened to a Revenue Builders Podcast episode with Randy Riemersma called "Why Deals Die Inside the 10 Yard Line." The discussion focused on why deals often fail late in the process. Not because the solution is wrong, but because value has not been communicated clearly to the buyer, or trust has not been built yet.

It reminded me of a concept from negotiation theory: Creating value versus Claiming Value, the work of David Lax and James Sebenius. They explain that every negotiation has both happening at once. Claiming value is dividing up a fixed pie, protecting your share, giving nothing away you don't have to. Creating value is expanding the pie first, so there's more for both sides to work with. Most people default straight to claiming. Guard your position. Say as little as possible. But the best negotiations spend real time in the creating phase before anyone starts dividing anything up.

It also got me thinking about one of the areas I have spent a lot of my career involved in: pricing and negotiations.

I have spent time working in Sales and Business Development, but my focus over the last 15 years has mainly been working alongside sales teams, supporting pricing analysis, building pitch decks, and providing commercial insight. I have often been front and centre during negotiations, helping teams and customers understand value, flexibility, and what a successful outcome looks like for both sides.

One thing I have learned over time is this.

Pricing negotiations are rarely just about price.

It's Not Just About the Number

There is often an instinct that it is best to hold your cards close to your chest. Companies worry that explaining their costs, investment, and margin just gives the client more to negotiate against them.

In my experience, the opposite can often be true.

If a client is negotiating on price, it usually means they already believe you can solve their problem. The conversation has moved from "Can you do this?" to "How do we make this work?"

Of course, some procurement processes are purely price driven. Competitive public service tenders, preferred supplier lists, blind bidding events where the lowest number simply wins. Those are different. But most B2B decisions are more complex than that.

The final decision is generally shaped by trust, experience, delivery capability, risk, and confidence. Not just in the company, but in the people representing it. This links closely to value based pricing, and the best commercial teams understand that pricing is not just about what something costs to deliver. It is about the value, expertise, and outcomes created for the client.

What the Customer Is Actually Buying

Let's take a company buying a database platform. That's a considerable investment, not a decision made on a whim. They are not just paying for access to technology. They are paying for implementation support, expertise, reliability, security, and the confidence that someone will be there when things go wrong.

When you help a customer understand how the price was built, and the value behind it, the conversation changes.

It moves from:

"How much discount can you give us?"

to:

"How do we make this work for both organisations?"

When This Doesn't Apply

Worth saying before I go further: this isn't a universal rule. I've spent most of my career in highly competitive industries, often with single digit margins, where every deal is contested and price is genuinely scrutinised. That's the environment this thinking comes from. If you're operating with real pricing power, a monopoly, a category of one, a market where the customer has nowhere else to go, the calculation is different, and holding your position matters more. This approach earns its keep specifically when you're fighting for the deal, not when you're the only show in town.

When Holding Your Cards Close Is the Wrong Move

Negotiation is often compared to poker. Keep your cards close. Protect your position. Give little away and show no emotion.

There is a time for that. Know your value. Know your walk away point. Sometimes listen rather than sell, and avoid negotiating against yourself.

But there is also a time when showing your hand actually strengthens your position.

There is often a fear that if a customer understands your costs or your required margin, they will simply use it to negotiate harder.

But customers are not always trying to take value away from you. Often they are trying to understand the logic behind your position. Why is the price what it is? What sits behind the investment? Is there a genuine reason behind the number?

Sometimes being transparent about the commercial reality builds more trust, not less.

Good customers understand that companies need to make a profit. Would you want a supplier who was underpriced and struggling to deliver or support you properly? The best partnerships aren't built when one side wins and the other loses. They're built when both organisations can succeed sustainably. This is when you can say you have a good relationship with the customer.

That doesn't mean sharing every detail of your cost base, or giving away your leverage. Good negotiators still know what to share, and when. But there are moments where explaining what it actually takes to deliver a successful partnership changes the conversation. It shifts the discussion away from simply reducing the number, and towards what both sides need to make the relationship work.

Explaining that a certain level of investment allows you to resource properly, maintain quality, and deliver what the customer actually needs, that shows the price isn't isolated. It's connected to the value being created.

Transparency can build trust.

Putting It on the Table

The strongest commercial teams aren't the ones who simply defend their price or give away discounts they don't need to. They're the ones who understand the value behind what they sell and can explain, clearly, why the price needs to be the price.

The best deals are never black and white, one side winning, the other losing. The best deals are the ones where both organisations believe they made the right call. That's creating value versus claiming value, the split I opened with, playing out in real time: expanding what's on the table before anyone worries about how it gets split.

Business and sport aren't as different as they're often treated. Both industries are resource allocation under pressure, both involve stakeholders pulling in different directions, both come down to the same question: protect your position, or grow the whole thing first. Sport just makes it easier to analyse. The results are black and white, played out in public and you don't need to get your calculator out or dig through financial statements to see whats really happening.

What I am explaining often plays out in sport, and it's happening as I write this. Steph Curry, one of the biggest names in world basketball is reportedly open to signing a below-max contract extension with the Warriors, a decision that could cost him as much as $40 million but would give the franchise added flexibility to build around him as he closes out his career. The template being talked about is also what Victor Wembanyama just did in San Antonio, taking roughly 25% of the salary cap instead of the full 30% he was entitled to, leaving around $50 million on the table.

Neither player is giving anything away for free. They've decided the best outcome for them is a stronger overall roster rather than worrying about their own slice of it, on the belief that a stronger team is worth more to them than maximising their own income during the contract renewal. Same principle as the pie: creating value before claiming it. In pricing terms, they are reducing their price because the value they get back is a real shot at another championship, is worth more to them than the discount they are offering.

That's what Randy Riemersma's point about deals dying inside the 10 yard line comes down to, in the end. It's rarely the solution that kills a deal that late. It's that value was never being created, never presented or sold to the customer.

Sometimes the strongest negotiating position isn't holding your cards close to your chest.

It's knowing when to put them on the table.

Blog by Padraig O'Donnell