We talk a lot about the negotiation skills gap between our sales teams and the buyers sitting across the table from them. And for good reason. In most B2B markets, salespeople are negotiating with purchasing and procurement groups who are receiving regular training specific to negotiations.
They are taught how to apply pressure, create uncertainty, extract concessions, challenge value claims, use timing to their advantage, and make perfectly reasonable prices sound like evidence of vendor arrogance, corporate greed, or maybe even a minor war crime.
Meanwhile, most sales teams receive negotiation training rarely or not at all. They get product training. They get CRM training. They’re taught pipeline qualification. They get told to “sell the value” and “hold the line” before being sent into high-stakes negotiations against better-trained people who’ve already negotiated 10X more deals than a typical salesperson ever will.
So yes, the external negotiation skills gap is very real and it costs companies a ton of money. But for pricing practitioners, external negotiations are only part of the equation…
Some of the most important negotiations pricing teams participate in never involve the customer at all. They happen inside the company…with sales managers, account executives, finance leaders, product teams, executives, bid desks, regional leaders, and whoever else has decided to parachute into the deal review process to provide another “set of eyes” or “make sure it gets the proper attention.”
And these internal negotiations can be every bit as difficult…much more political…and a lot more personally frustrating than anything happening with the customer.
The problem is that pricing teams don’t always think of them as negotiations. We call them pricing reviews, exception approvals, deal strategy discussions, margin conversations, price increase planning meetings, governance forums, or even just a “quick call” someone scheduled because they didn’t like the answer they got through the quoting tools.
But make no mistake…these are negotiations.
Someone wants something. Someone else is trying to protect something. There are competing goals, incentives, constraints, risks, tradeoffs, and different definitions of what “reasonable” and “success” means. That’s a negotiation, my friend…even if everyone is pretending it’s just an informal chat.
That recognition is the first concept pricing practitioners need to embrace. If you don’t recognize the interaction as a negotiation, you will probably prepare for the wrong conversation. You’ll bring the spreadsheet, showing the margin impact, the historical discounting data, the segmentation logic, and the chart showing that this customer has already received more exceptions than any other customer.
All of that is necessary, but insufficient…
Internal pricing negotiations are rarely just about the numbers. They are about revenue pressure, customer relationships, sales credibility, executive attention, political risk, account ownership, local flexibility, forecast commitments, and who will have to defend the decision later.
The second concept is to stop assuming the analysis will carry the room. Analysis matters, of course. Pricing teams should provide evidence, not vibes. But evidence does not automatically win the argument. If it did, half of these discussions would be over in five minutes.
Instead, pricing practitioners need to prepare for the predictable objections and the real motivations behind them.
Who will say the customer is strategic? Who will say the competition is pricing lower? Who will describe this as a one-time exception, despite the long and storied history of previous one-time exceptions? Who will imply that pricing is being theoretical, academic, ivory tower, or insufficiently “customer-centric”?
Now…you don’t need to be as cynical as I am. You just need to stop being surprised or blindsided by all these incredibly predictable behaviors.
The third concept is to negotiate the terms of the whole decision, not just the price. Too many internal pricing discussions get framed as pricing versus revenue, pricing versus sales, or pricing versus the customer relationship. That is a losing frame. Once the conversation becomes “pricing is blocking the deal,” the pricing team is already playing defense.
A better frame will focus on what everyone is trying to accomplish, what we are willing to trade, what risks we are willing to accept, what precedents we might be creating, and who ultimately owns the outcome. That moves the discussion away from “So will pricing approve the discount?” and toward “What is the business case and what do we get in return?”
If sales wants a concession, pricing should ask for something back. Volume commitment. Longer term. Reduced service scope. Better payment terms. Executive access. Reference rights. Cleaner renewal language. A phased recovery plan. Something. Otherwise, we’re not negotiating. We’re just taking requests.
The fourth concept is to force tradeoffs into the open…
Internal stakeholders often want the benefit of a pricing exception without the discomfort of acknowledging the cost. They want the discount without calling it margin erosion. They want flexibility without admitting precedent. They want speed without accountability. They just want pricing to approve the thing while they reserve the right to complain later when the same customer expects the same treatment forever.
A prepared pricing practitioner calmly makes the tradeoff visible. “We can approve this, but here’s what we’re giving up.” “We can match the competitor, but that implies we believe the offerings are equivalent.” “We can make the exception, but only if we define how this gets unwound at renewal.” That’s not being difficult. That’s just being transparent.
The fifth concept is to separate advocacy from decision rights. Pricing teams should advocate for better decisions. They should provide evidence, options, risks, recommendations, and short- and long-term implications. But they also need to be clear-eyed about who has the authority to override the recommendation.
If someone else has that authority, fine. The key is to make the accountabilities and responsibilities clear. Not in a petty or snarky way. Just getting in the habit of clearly and professionally documenting the original recommendation, the exception request, the rationale, the expected impact, and who ultimately approved it.
You’ll be amazed at how much more thoughtful people tend to become when their name is attached to a decision.
Internal pricing negotiations will never be fun. There are just too many competing objectives, incentives, personalities, and political dynamics involved. But they suck less when pricing practitioners embrace a handful of core ideas:
- Recognize that it’s a negotiation. Don’t treat internal pricing discussions as neutral when they are full of competing interests, incentives, and risks.
- Stop assuming the data will win the day. Bring the numbers, but prepare for the human, political, and organizational dynamics, too.
- Negotiate the whole decision, not just the price. If someone wants a concession, define the business case and ask what we get in return.
- Force the tradeoffs into the open. Make the cost, risk, precedent, and accountability visible before everyone rushes to the easiest answer.
- Separate advocacy from decision rights. Recommend clearly, document cleanly, and make sure anyone overriding the recommendations ultimately owns the outcome.
And finally, we must remember that the goal is not for pricing to “win” every internal negotiation. The goal is to improve the quality of pricing decisions over time. Sometimes that means holding firm. Sometimes it means giving ground. Sometimes it means letting the organization learn from a bad decision instead of trying to save everyone from themselves every single time.
Pricing is not just there to say yes, say no, or generate another spreadsheet. Pricing is there to help the business make better commercial decisions…even when it seems as though some in the business would rather not.
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