B2B Pricing Strategy Guide: Tools and Implementation

Expectations in business-to-business (B2B) ecommerce are sky-high, and for good reason—it’s already a $10 trillion industry that’s expected to keep surging well into the early 2030s. You can point to numerous factors: the normalization of online shopping, the boom in smart manufacturing, and the rise of more personalized, customer-friendly B2B experiences as millennial buyers take the lead. 

The upshot of that last point is: buyers now expect the seamless, enjoyable experience of online B2C shopping to be replicated in digital B2B. Buyers are drawn to the approaches of companies like Dermalogica Pro and Syra Coffee, who have prioritized engaging content, intuitive self-serve options, and pricing that’s clear up front. 

But coming up with an effective pricing strategy isn’t easy, especially for businesses used to the faster pace of B2C. B2B sales cycles are longer, more complex, and often tailored to the unique needs of each customer. But you’re not in this alone: Choose the best ecommerce platform for your business, and you can optimize pricing to keep up with ecommerce trends as they unfold. 

Let’s explore how to do just that.

What is B2B pricing? 

B2B pricing is the model companies use to set, quote, and adjust prices for sales between businesses. For example, the price you pay for a single laptop at a store is different from the price a school district pays for 1,000 laptops. 

The shift to ecommerce means brands need pricing that’s clear, consistent, and reliable. When a business is about to spend $100,000 online, they need to have complete confidence in the price they see.

Pricing is different in B2B versus B2C, and here’s why:

• Contract and quote-driven: B2Bprices are governed by multi-year agreements and quotes, with clauses that handle volatility. For example, a resin supplier adds a quarterly escalation clause to reflect feedstock movements.
• Multiple stakeholders and approvals: In B2B,buying committees and risk control determine how prices are presented, often as tiered quotes or bundles that then go through approvals. A good example is an equipment buyer who shortlists vendors via portal pricing, then routes the preferred quote to finance for approval.
• Customer-specific pricing: Each B2B buyer has negotiated payment terms and rebate programs. A 2024 global study of B2B firms found a growing focus on negotiated pricing and rebate structures to protect margins and strengthen relationships.

Shopify B2B simplifies what once required complex cost inputs and price delivery mechanisms. With Shopify B2B, you can create custom price lists and assign them to specific company profiles. When a buyer logs in, they automatically see their negotiated prices and payment terms throughout the store. 

Fragrance brand WHO IS ELIJAH used custom catalogs to run an eight-store expansion. Once each region had its own catalog and price matrix, international wholesale revenue climbed 50% year over year.

“One of the reasons we needed custom pricing for our wholesale customers was that many of them fall into different B2B categories; some have hard margins, and some we can control,” says the brand’s technical leader, Brylee Lonesborough. “The custom catalog capabilities in B2B on Shopify meant we could set individual pricing categories and attach them to the various types of B2B customers we have so they get a more personalized experience.”

B2B pricing models 

The ecommerce pricing strategy that’s best for a sustainable pet supplier may look very different from the one a big tech company uses to launch a new gadget. What model is best for your business? 

B2B pricing models are driven by the core principles of cost and profit—in other words, your revenue goals. If your prices are too high, you’ll risk losing customers—but if they’re too low, you’ll leave profit on the table. 

We’ve outlined some of the most common pricing models, all of which offer different ways to reach your goals. 

Value-based pricing

Value-based pricing sets prices based on the value proposition offered to the customer. This strategy focuses on understanding and leveraging the customer’s perception of value.

By assessing how much customers are willing to pay based on the benefits they derive, businesses can set higher prices for products or services that offer significant value. For instance, businesses with a key differentiating factor—like sustainability—are better equipped to set higher prices. 

The key challenge is the considerable amount of market research value-based pricing requires to set prices effectively. 

Cost-plus pricing

Cost-plus pricing involves calculating the cost of providing a product or service, including materials, labor, and overhead. A fixed percentage markup is then added to determine the final price. This model is common in industries with standardized products and heavy competition.

Competitor pricing

Competitor pricing involves analyzing the prices your competitors set and adjusting your own prices accordingly. The goal is to attract customers with competitive rates.

While this approach can help maintain market share, it may also trigger price wars and erode profitability if mismanaged. Apps like Prisync can track competitor pricing and auto-adjust your own prices, helping you optimize profit margins. 

Dynamic pricing

Dynamic pricing uses algorithms and real-time data to adjust prices continuously in response to changing market conditions, customer behavior, and competitor actions. Common in industries with fluctuating demand, such as airlines and hospitality, this model optimizes revenue by aligning prices with current market trends and consumers’ willingness to pay.

Dynamic pricing can maximize your product’s customer base. For instance, it gives customers with smaller budgets the opportunity to buy products at times when they’re priced lower, or to access discounts when buying in bulk. 

Freemium pricing

The freemium pricing model attracts a large user base by offering core functionalities at no cost while monetizing through premium versions with advanced features, premium support, or expanded functionality. This model is common in the software industry, especially among software-as-a-service (SaaS) companies.

Tiered pricing 

Tiered pricing sets different per-unit pricing for quantity bands. Buyers pay one rate for the first block of units, a lower rate for the next block, and so on. It encourages larger orders without discounting every unit to the lowest rate. 

B2B companies use tiered pricing when they have high fixed costs with declining unit costs. As volume climbs, fixed setup spreads across more units, and variable costs drop. Average cost per unit declines, so it’s rational to lower the price on later blocks without underpricing the whole order.

Pricing structures and tactics

Flat-rate pricing

Flat-rate pricing charges a fixed price regardless of usage or purchase volume. This pricing model is common in industries with predictable costs. 

Usage-based pricing

Usage-based pricing ties cost directly to consumption: the more usage, the higher the cost. This pricing model is typically used by B2B businesses whose products are used on a recurring basis or require ongoing support. 

Per-user pricing

Per-user pricing charges a fee based on the number of licenses purchased (common with software and Saas). This pricing model is based on the idea that the more users a business has, the more value it gains from the product or service.

Anchoring and decoys

When people make economic decisions, they tend to consider relative differences rather than absolute numbers. If customers are shown a $450 product originally priced at $500, they’re more likely to view $450 as a bargain. As a tactic, this is called price anchoring.

Companies can leverage this knowledge to boost willingness to purchase by anchoring at a higher initial price.

Similarly, decoy pricing persuades customers to spend more by strategically placing certain products alongside others. This is the tactic behind the classic coffee shop upsell, where the large seems like better value because the medium is only 50 cents cheaper. A B2B company could similarly use a “decoy” middle-tier price to generate more sales for its most expensive option.

Charm prices and odd prices

Our brains make rapid judgments and simplify numbers—charm pricing taps into this tendency. Since the 19th century, studies have indicated prices ending in the number nine tend to bring a higher conversion rate. The same holds for other odd endings—giving rise to “odd pricing.” 

Reducing a price by one cent—say, from $20 to $19.99—plays off the “left digit effect,” which subconsciously leads customers to favor the lower-looking number, even though the amounts are nearly identical.

Advanced B2B pricing methodologies

Smart cost-plus approach

The smart cost-plus approach is an evolution of traditional cost-plus pricing. It’s the difference between Iron Man’s first suit and his latest one. 

His conventional suit, built in a cave, is a blunt tool that gets the job done. The smart approach is like his nanotech suit—intelligent, adaptable, and able to deploy the right price for any situation. 

A smart approach applies differentiated markups for different situations. It takes the true cost (materials, labor, overhead, freight, duties, handling) plus the cost to serve, then varies the markup by factors like product value, customer segment, or competition. 

For example, say a wholesale food distributor sells premium imported olive oil to a supermarket and a specialty deli. 

• For the supermarket, where it’s high volume and high competition, it applies a lower 25% markup, pricing the bottle at $12.50. 
• For the deli, where it’s low volume and customers are less price-sensitive, it applies a 70% markup, pricing the bottle at $17.00.

With a smart cost-plus approach, the distributor captures both accounts. It maximizes margin from the small deli while securing high-volume from the large chain. 

Peer pricing for data-rich environments

Peer pricing is a sophisticated way to set prices. It compares a new quote to similar historical deals, and helps answer the question, “What did a customer just like this, buying a similar product mix, actually pay?”

As you might expect, executing this strategy requires clean data and the right tooling. Shopify offers pricing optimization apps to monitor competitors' prices in real time and adjust your own accordingly. 

With a tool like Prisync, you can make peer pricing comparisons from any website, and Prisync sets prices automatically to protect your profit margins. 

Value-based innovation pricing

When you have a product that is brand new or differentiated, you can price it against the economic value created, not what it costs to make. 

That’s value-based innovation pricing. It quantifies the measurable outcomes buyers get from your product, converts them to dollars to determine the economic value, and adjusts prices accordingly. 

For example, imagine selling a maintenance sensor that reduces unplanned downtime by eight hours per month on a line worth $2,000 per hour. That’s $16,000 per month in value. The final price would capture a percentage of this value (say, between 30% and 50%). In this case, you’d charge between $5,000 and $8,000 per month plus onboarding. 

How to choose a B2B pricing strategy

Businesses use pricing strategies to execute their pricing models. In B2B, complex sales cycles—combined with high revenue potential—make deep market knowledge essential. 

Pricing strategy development

A pricing strategy is a set of guidelines for pricing products or services based on market demand, customer behavior, and competition. It helps you understand the buyer’s willingness to pay (WTP). 

Pick a base model per product/segment, define when exceptions apply, and codify it so reps and checkout maintain price consistency. 

Pricing objectives and goals

Pricing should serve a small set of goals, like growing revenue in a strategic SKU family, increasing win rates, and protecting margins. Decide which KPIs to prioritize over the next two or three quarters, then embed them in systems and workflows so enforcement is automatic. 

Market research and analysis

In B2B, pricing research blends buyers input, actual purchasing behavior, and competitor moves. Listening to buyers uncovers what outcomes they value. Examining past deals from competitors reveals what people are actually paying. 

Together, using these inputs results in consistent quotes across teams and makes your price changes more defensible. Here’s the research to take care of:

• Talk to between 5 and 10 customers per segment. Note the outcomes they measure and the prices that feel too low, fair, and too high.
• Pull 12 months of orders. Record the actual paid price after discounts for each product by segment to find a typical range.
• Log the three nearest competitors with list prices, common discounts, and terms. 

Once you’re done, create a one-pager for each product and segment with target price, floor price, allowed discounts, and review dates. Share it with your team before the next decision meeting. 

Technology and tools for B2B pricing

Configure, price, quote (CPQ) software

CPQ software applies pricing rules so reps and checkout show the same price for the same customer, SKU, and terms. It speeds up quoting, prevents rogue discounting, and enforces floors and approval automatically. Approved prices sync to ecommerce so the portal, invoice, and quote all match. 

For example, a rep quotes 120 units of SKU A. CPQ applies the correct tier break, checks the $62 floor, and recommends $64. If the rep tries $61.50, the system routes it for approval. If approved, the price is pushed to checkout. Two popular options are Conga CPQ and Oracle CPQ. 

Pricing intelligence platforms

These platforms set price guidance using past deals and market inputs. They help you figure out floors, targets, and peer ranges, then publish them to CPQ and ecommerce. 

A tool like Pricefx or Vendavo can find last year’s paid range for SKU P200 in distributors ($62–$66), set the target at $64 with a $62 floor, and sync that guidance to all your systems. Pricing can change in minutes without any manual handholding. 

Data analytics tools

Business Intelligence (BI) tools pull orders, discounts, costs, and terms into clean, easy-to-read dashboards for review. They help teams understand where pricing works and where it leaks margin. 

For example, a dashboard might show pocket margin on SKU family B dropping to 33% after stacked promos. The team can raise the floor by two points and cap stackable discounts to recover margin.

Top tools in this category are:

• Microsoft Power BI
• Tableau
• Looker

Avoiding common B2B pricing mistakes

Pricing and business goals go hand in hand. Unfortunately, B2B pricing can be tricky and complex, undermining even well-intentioned goals. 

Here are some common issues to look out for:

Making pricing too complicated

B2B businesses can overcomplicate pricing with confusing price structures and hidden fees. Such headaches can frustrate customers and dissuade them from returning. 

Relying exclusively on undercutting competition

Focusing exclusively on undercutting competitors in your pricing strategy can backfire. This “race to the bottom” often undervalues your product and cheats you out of potential profits. 

Amazon might lower prices constantly to outmaneuver competitors, but there’s a good chance its model and goals differ greatly from yours. Focus on your goals and price accordingly. 

Neglecting competitor responses to your price

Of course, B2B businesses can’t afford to completely disregard competitor pricing. Monitor pricing trends in your space. 

If competitors are cutting prices due to a glut of overstock on a particular item, you may want to lower prices to avoid warehouse buildup—or at least analyze how the situation affects you. Develop actionable responses and deploy them accordingly. 

Misaligning pricing and business goals

Pricing is intimately linked with business goals because it determines a business’s profit margins and the volume of B2B sales required to break even.

Establish quantifiable business goals, then fine-tune your pricing to reach them with realistic sales volumes.

Factors influencing B2B pricing

Market demand

Market demand refers to the total quantity of a product or service that consumers are willing and able to purchase at a given price within a specific market. It significantly influences pricing decisions because when the demand rises, businesses can raise prices to maximize profits. 

You can quantify market demand with SEO research tools like Keyword Surfer, social listening practices, and analysis of data and market trends.

Cost of goods sold (COGS)

Calculating the total cost of producing a product, including materials, labor, and overhead, is essential for setting profitable prices. It helps to determine profitability, optimize inventory, and keep track of expenses. 

COGS is calculated by determining direct and indirect costs, figuring out beginning inventory and cost of purchases, calculating ending inventory, and applying the COGS formula. The accepted COGS formula used by accountants is (Beginning Inventory + Purchases) – Ending Inventory = COGS.

Customer segmentation

Different customer segments have varying price sensitivities and value perceptions. 

By segmenting the B2B market based on criteria such as industry, company size, and purchase behavior, businesses can tailor their pricing strategies to each segment’s needs.

Economic conditions

Economic factors such as inflation, currency fluctuations, and overall market conditions, can all influence pricing. 

Pricing governance and management

Governance influences B2B pricing by hard-coding rules. For instance, the floor price is $62, with a maximum discount of 8%. New prices take effect on September 1. These rules cap how low quotes can go and when changes take effect. 

It also sets terms/rebates, which directly change the net price collected after the invoice. In practice, that moves deals from $59–$66 to $62–$66 and keeps margins predictable.

Best practices for B2B pricing

Determining the value of your product

Start by identifying your target market and the specific problem your product solves for them, as this is the foundation of its worth. 

Next, conduct market research to analyze how your solution measures up against the competition, to establish your unique position. While you must calculate your internal costs, the last step is to synthesize this information—the customer's need, your competitive advantage, and your costs—to define your product’s actual perceived value.

Experimenting with various pricing models

Your pricing strategy should never remain static. You want to adapt to customer behaviors and market conditions to protect your margins. A/B testing is a great way to test different pricing strategies. 

Test a variety of elements:

• Price points: Is the conversion rate higher at $49 per month or $59 per month?
• Pricing structures: Does a three-tiered model generate more overall revenue than a single, all-inclusive price?
• Promotions: Do volume discounts attract more valuable long-term customers than free implementation services?

Making data-driven decisions

Track sales and customer behavior to make data-driven decisions about pricing strategies. Key metrics to watch include customer acquisition cost, annual contract value, gross margin, churn rate, and price elasticity. 

Use Shopify Analytics to build reports and track these metrics. Filter your reports by customer segments to see the direct impact of your testing efforts and refine your strategy.

Maximizing revenue with B2B pricing

Increasing profitability

A strategic B2B pricing model directly impacts the bottom line by setting prices that cover costs and generate strong margins. Understanding customer value and willingness to pay allows businesses to adjust pricing strategies for increased revenue and sustainable profitability.

Enhancing market positioning

Well-structured pricing strategies help position a business competitively in its market. By offering the right prices for their products or services, companies can differentiate themselves from competitors, attract more business clients, and establish themselves as leaders in their industry. 

Improving customer retention

Tailored and value-based pricing helps businesses foster loyalty by ensuring customers feel they are receiving fair value for their investment, strengthening long-term relationships. 

Driving sales growth

Effective pricing strategies drive sales growth by making offerings more attractive to prospects. Competitive and dynamic pricing models can capture demand, encouraging larger purchases and repeat business, and boost overall sales and market share.

Shopify makes pricing easy

We’ve seen ecommerce evolve at warp speed in recent years, as a new generation of buyers reshaped B2B buying through new technology. Deploying multiple pricing strategies in concert—let alone settling on one while keeping up with industry trends—can feel overwhelming.

But it doesn’t have to be.

If you need the tools to implement dynamic pricing, Shopify has them built in. Want to make self-serve as intuitive as possible for your millennial buyers? We’ve got you covered. 

At Shopify, we’ve evolved alongside the ecommerce revolution, and we’re excited to help you launch the pricing strategy that drives your growth.