Chapter 13 · The Discount Is the Profit
The last pages of the chapter, unedited.
What I remember most about Pathway Systems isn’t the half-off deals. It’s that nobody was angry about them. There was no villain. Every one of those discounts was approved by someone who believed they were doing the right thing, and in the moment, most of them probably were.
The rep wanted the deal. The manager wanted the month. The company wanted the logo. The customer wanted a better price, and got one. Everybody got what they wanted, and the company got quietly poorer.
But I want to be careful about the word nobody, because it lets too many people off the hook. Including me.
Somebody always knew.
The rep knew, on at least a few of those deals, that the customer would have signed anyway. The manager knew this wasn’t one discount, it was the fortieth that quarter. Somebody in finance had watched the average selling price slide for years and could have said so in a meeting. I knew — I was the one with the spreadsheet, staring at a number that wasn’t a number, and it took me a long time to say it out loud to anyone who could do something about it.
None of us were blind. We were quiet.
Because saying it meant owning the fix, and the fix meant telling a customer their price was going up. It meant being the person who pushed and maybe lost the account. It meant walking into a room and telling people that a plan they’d already built was resting on a price we hadn’t charged in three years.
It was easier to approve one more. It always is.
That’s why the story my boss told has stayed with me for twenty years. He didn’t have better information than anyone else. He just said the uncomfortable thing out loud, to a customer who didn’t want to hear it, and accepted that it might cost him the deal. The discount wasn’t the hard part. The sentence was.
I’m not asking you to stop discounting. I’m asking you to know what it costs, to decide who owns it, and to stop giving it away to people who had already made up their minds.
Somewhere, a regulator decided that training customers to distrust your prices was harmful enough to outlaw. Nobody will ever enforce that against you. You’ll have to do it yourself — which means somebody in your building has to be willing to say the thing nobody wants to hear.
I was eighteen years old, standing in a shoe store on a dead Tuesday afternoon, wondering where everybody was. They were coming on the weekend. We had taught them to.
The price on your price sheet is an opinion. The price on your invoices is the truth. If nobody owns the gap between them, it will keep growing — and it will never once show up on a report, because a report is not the same thing as a person willing to say it.
End of chapter thirteen. Twelve more like it.