SD-301j · Module 2

Pricing Boundary Documentation

3 min read

The pricing boundary document is created before the negotiation, approved by leadership, and not renegotiated in the room. It contains four numbers: the list price, the target price (the realistic outcome that protects margin), the floor price (the lowest acceptable number), and the walk-away point (below which the deal is not worth taking). Each number has a documented rationale. The target price reflects competitive positioning and value delivered. The floor price reflects cost structure and minimum acceptable margin. The walk-away point reflects the BATNA calculation. When the negotiation moves to pricing, the rep is not making decisions — they are executing within pre-approved boundaries.

Do This

  • Document all four pricing boundaries before the negotiation and get leadership sign-off
  • Include the rationale for each boundary so the rep can explain the pricing logic, not just defend a number
  • Update the boundary document if new information emerges during the negotiation that changes the value equation

Avoid This

  • Enter the negotiation without a documented floor price — improvised boundaries move under pressure
  • Set the walk-away point in the room while the prospect is watching — the math is wrong under stress
  • Give the rep authority to go below the floor without escalation — the floor exists to protect margin