Operational Pricing
What Is a Pricing Audit and How Do I Do One?
Short answer
A pricing audit is a systematic review of your entire product catalog's pricing: competitive position ratios, discount structures, bundle coherence, and margin health. It answers the question 'are my prices doing what I think they're doing?' Most brands should run one quarterly, and the process takes 1-2 hours for a catalog of 50-200 SKUs.
The full answer
A pricing audit is the pricing equivalent of a financial audit — a structured look at whether your numbers are where you think they are. Most founders set prices at launch, adjust them occasionally based on gut feel, and never do a comprehensive review. The result: prices drift, discounts stack, bundles become incoherent, and margin erodes without anyone noticing until the P&L looks wrong.
A basic pricing audit covers five areas. First, competitive position: for every SKU (or a representative sample of your catalog), calculate the position ratio (your price / competitor midpoint). Classify each as Value (<0.90x), Parity (0.90-1.10x), or Premium (>1.10x). Compare this to your intended position. The gap between intention and reality is your first finding.
Second, discount structure: list every active discount — subscription savings, welcome promos, loyalty rewards, bundle discounts, seasonal sales, coupon codes. For each, calculate the effective price a customer actually pays when discounts stack. A $30 product with 15% subscription discount, a 10% welcome code, and free shipping ($5 value) has an effective price of $17.85 — 40% below list. If your COGS is $12, that's a $5.85 margin on what should have been a $30 sale.
Third, bundle coherence: if you sell products in multiple quantities (single, 3-pack, 6-pack, subscription), check that per-unit pricing decreases monotonically as quantity increases. A 3-pack at $8.50/unit and a 6-pack at $8.75/unit is incoherent — the customer is penalized for buying more. This happens more often than you'd think, especially when different bundles were created at different times.
Fourth, margin health: for every SKU, calculate contribution margin (price minus COGS minus variable costs). Flag any SKU where contribution margin is below your minimum threshold. If you sell through multiple channels, check margin per channel — a product that's profitable DTC might be underwater at wholesale pricing.
Fifth, velocity alignment: if you have sales data, cross-reference position with velocity. High-velocity products at Value pricing are leaving money on the table. Low-velocity products at Premium pricing may need repositioning or delisting. This is the assortment matrix — Position x Velocity — and it turns a static audit into an action plan.
Related questions
How often should I run a pricing audit?
Quarterly is the right cadence for most brands. More frequent audits create analysis paralysis without enough new data to act on. Less frequent audits let problems compound — a misaligned price that goes unchecked for 6 months costs real money.
Can I audit just my top sellers instead of the full catalog?
Yes, and it's a good starting point. Your top 20% of SKUs by revenue likely drive 80% of your margin. Audit those first. But don't skip the tail entirely — low-performing SKUs with Premium pricing are often candidates for delisting, and you won't find them by only looking at top sellers.
PricePilot automates the pricing audit for your entire SKU catalog — competitive positioning, discount checks, bundle coherence, and assortment analysis in one ranked report. Run your audit for $39.