Worksheet: Build the price waterfall for your ten biggest customers

List price is a starting point. The number that matters is the pocket price, what is left after every discount, rebate, term and allowance. This sheet builds it for your ten biggest customers and gives the two biggest leaks an owner. It builds the Competent step of the check:

A price waterfall from list to pocket exists for major customers and is updated at least quarterly.

Step 1. The waterfall, per $100 of list

Customer	List	On-invoice discounts	Invoice price	Rebates	Prompt-payment and extended terms	Freight we absorb	Other off-invoice (promotions, free goods)	Pocket price	Pocket as % of list
e.g. Customer 1	100	12	88	4	1.5	3	1	78.5	78.5%
1	100
2	100
3	100
4	100
5	100
6	100
7	100
8	100
9	100
10	100

Off-invoice items usually sit in the ledger, away from the sales system. Finance will need to allocate them to customers.

Step 2. Inside policy or beyond it

Customer	Discounts inside policy ($)	Discounts beyond policy ($)	Who approved the excess

Step 3. The two biggest leaks

A leak is a step in the waterfall with no link to the customer's volume or value.

Leak	Customers affected	Dollars a year	Owner	First action	Review date

Step 4. Update each quarter

Quarter	Updated by	Biggest change since last quarter

Done when: your ten biggest customers have a list-to-pocket waterfall updated each quarter, and the two biggest leaks each have an owner.

Adapted from our own B2B pricing playbook (PSP, 2026).