The price isn't set in stone: it's a variable, not a legacy

The inherited prize, never reopened

The same scenario plays out in most companies: a product is launched, a price is set—based on cost, rapid competitive alignment, or sometimes simply on intuition. Then time passes. The product remains in the catalog, sales level off, and the initial price becomes, without anyone explicitly deciding it, the permanent benchmark.

This price has remained in place for years, sometimes automatically adjusted for costs, but almost never reevaluated from scratch. No one asks anymore whether this figure still reflects today’s perceived value, the company’s actual competitive position, or the market’s ability to absorb a price adjustment.

This mechanism affects both established product lines and new products alike: the longer a price remains unchanged, the harder it becomes to question it—with each passing year, the impression that it is “normal” grows stronger, since it has never posed any visible problem.

This phenomenon is not limited to the final selling price. It applies equally to B2B pricing structures, discount schedules, and terms negotiated with a distributor—once a figure is set for the first time, it tends to become a permanent benchmark, regardless of the context in which it was originally established.

Why Inertia Almost Always Wins Out

This inaction is not due to a lack of vigilance, but rather to a predictable organizational dynamic. Reopening a price requires appointing a person in charge, gathering data, and assessing a perceived risk—three tasks that the organization naturally postpones as long as it is under no obligation to do so.

Conversely, leaving a price unchanged costs nothing in the short term. No alert is triggered when a price remains static for too long; the alert, however, is triggered immediately when a price drops and the margin suffers as a result. This asymmetry explains why the status quo almost always wins out over change, even when the change would be profitable.

In theory, a spreadsheet doesn't prevent you from revising prices on a regular basis. But in practice, the lack of a dedicated tool almost always goes hand in hand with the lack of a process: without a structured reminder, price revisions are handled on an ad hoc basis rather than according to a schedule. This is a symptom of the same problem already described in the flagship article of this series: without a designated person in charge, there is no pressure to revisit the issue.

The Cost of a Fixed Price

This figure, measured on a macroeconomic scale, confirms on a large scale what we observe in each individual company: the regular price—the one not tied to a one-time promotion—is structurally fixed. This is not unique to a poorly managed organization—it is a fundamental trend in the economy, which makes it all the easier to correct for those who recognize it.

A fixed price comes at a cost in three distinct ways. First, in terms of lost profit margin: if the value perceived by the customer has increased since launch, every month without an adjustment is a month of profit left on the table. Second, through competitive misalignment: a market that fluctuates around a fixed price eventually makes it either too expensive or abnormally competitive, without the company deriving any conscious strategic advantage from it. Finally, through a loss of responsiveness: faced with rising material costs or an inflationary shock, an organization that has never revised its prices lacks both the data and the reflexes to do so quickly.

This last point is worth emphasizing: an organization that revises its prices for the first time in years, in the midst of a crisis, does so under the worst possible conditions—under pressure, without perspective, and often in response to an emergency rather than by choice. An organization that is already accustomed to making regular revisions navigates the same crisis with well-honed reflexes, which radically changes the quality of the decision made.

Treat price as a controlled variable, not a legacy factor

The necessary shift in mindset can be summed up in one sentence: a price is not a fixed characteristic of a product, like its color or catalog number—it is a dynamic decision that deserves to be reviewed with the same rigor as a budget or a sales plan.

This doesn’t mean constantly changing prices, nor does it mean imitating the real-time pricing strategies of certain major e-commerce players— dynamic pricing, which algorithmically adjusts a price in real time based on demand, is a topic in its own right, covered elsewhere on the Booper blog. The “price as a variable” discussed here is a slower, broader organizational approach: moving beyond the false dichotomy between “prices that are fixed forever” and “prices that change constantly.” Between the two lies a happy medium: prices revised at a consistent, methodical pace, rather than never or at random.

This shift in approach also makes it possible to test a price change without scaring off customers —a topic discussed in detail elsewhere in this issue, since testing inherently involves accepting that prices may fluctuate.

What Should Trigger a Price Adjustment

Building a Four-Step Review Cycle

Three Common Misconceptions About Price Changes

• “A stable price reassures the customer.” To the customer, a stable price is no different from a price that has simply been forgotten. What reassures the customer is the consistency of the pricing policy, not the absence of change.
• “Changing prices is risky.” Never changing them is just as risky—the silent loss of margin simply doesn’t trigger any visible alerts, unlike a poorly calibrated deliberate price cut.
• “We’ll change the price when we have time.” Without a deadline set in advance, that moment never comes: this is precisely the mechanism of inertia described above.

The question of who should be involved in this decision to ensure its long-term viability is the subject of another article in this series.

FAQ

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Also in this series

• Why Do So Few Companies Actually Manage Their Prices?
• Testing Your Prices Without Losing Customers: The Method
• Pricing: Why Pricing Decisions Should Never Be Left to a Single Person

Sources: EPP (European Pricing Platform) & Vendavo, 4th Global Pricing Maturity Study, January 10, 2023 · European Central Bank / Eurosystem PRISMA network, as reported by the National Bank of Belgium, Economic Review 2022/4, “Price Setting in the Euro Area”