Death by a thousand cuts: profit lost by discounting the long tail
It’s easy to let pricing discipline slip for small deals as you focus on the big deals. But, just as for e-commerce, the long tail makes up a large share of your contribution margin. Don’t discount small deals the same way as big deals!
You should lose more deals on price
If you allow your sales team to play safe you will lose fewer deals on price, but this comes at the expense of contribution margin. Dare to price up and create higher contribution out of fewer deals.
Overperformance is cheap!
Business owners reluctantly pay out large commissions to overperforming sales executives. Yet it’s the underperforming sales people who deliver the most expensive revenue.