Worksheet: Check the fence around every lower price

A student price, an off-peak price or a member price only works if the people it is not meant for cannot get it. This sheet lists every lower price and tests the fence around it. It builds the Competent step of the check:

Deliberate price differences exist by channel, timing or version, with fences that mostly hold.

Step 1. Who is meant to pay less

Lower price	Discount (%)	Meant for	The fence (what stops others)	Revenue at this price ($)
e.g. Student price	15%	Enrolled students	Student ID checked at checkout	1.2m

Step 2. Test each fence

Try it as a customer who should not qualify. Search for your codes on coupon sites. Count sales at the lower price that happen outside its window or channel.

Fence	Test	Result	Leakage (% of sales at the lower price)	Fix
e.g. Off-peak price	Count off-peak prices rung up at peak times	Staff override at the till	18%	Remove the till override

Step 3. Differences you could fence but do not

Price sensitivity often differs by region, payment method, channel, customer age, product mix and how long someone has been a customer.

Group	Evidence they are less or more price sensitive	Fence that would hold	Worth a test?

Done when: each deliberate price difference has a written fence, and a test shows most fences hold.

Adapted from our own pricing process (PSP, 2004).