Most distributors are entering planning season for 2026 with the hope that next year will be the one when pricing will finally drive real margin improvement. But hope isn’t a strategy, and spreadsheets aren’t a pricing system.
Pricing remains one of the least modernized functions in distribution, even though it is the most powerful lever for profit improvement. In fact, you can get more from a 1% increase in price than from increases in sales volume or cuts in cost of goods sold.
Yet many distributors still treat pricing as a manual, administrative activity rather than a strategic engine.
The result: In many companies, system pricing isn’t trusted. Sales reps override it and default to cost-plus numbers that end in zero or five (sound familiar?). When overrides are high, what your sales team is telling you is: The pricing strategy isn’t working, so they’ll make up their own.
That’s inefficient, and it erodes margin every day.
If you’ve been selling the same products for 50 years, but reps are still guessing at price, the problem isn’t the market. It’s that leadership hasn’t given the team confident, data-driven pricing guidance. We’re asking reps to sell and protect margin at the same time, and the result is that neither happens as effectively as it should.
Here’s what you need to do:
View AI as an Accelerator, Not The Strategy
Powerful AI-enabled tools are available that solve problems that have been painful and manual for decades: pricing optimization, special pricing authorization (SPA) management, and rebate visibility. These tools make work faster, less error-prone, and more scalable.
But while AI can crunch numbers faster than humans ever could, it can’t replace judgement or the nuance we need to understand our customers, suppliers, and markets. The winning formula is AI and humans together: people who embrace new capabilities and use them to support pricing strategy.
Most reps, regardless of age and tenure, are more willing to adopt new tools than we give them credit for. What slows distributors down is leadership hesitation.
Lead from The Top
If the CEO isn’t in, it won’t happen. Pricing touches every part of the business. That means its success depends on cross-functional support that starts with the CEO.
I’ve seen good pricing initiatives fail because they were confined to a silo or because the objectives didn’t connect to company-wide goals. If pricing isn’t championed from the top, other priorities will always take precedence, and the work will slow to a crawl.
Incremental or Transformational? You Choose.
Too often, companies say they want to change—but what they really want is improvement without disruption. You must be clear on whether 2026 will be incremental or transformational.
Incremental means keeping the trains running on time while making them go faster. Transformational means rethinking strategy, tools, skills—and sometimes even leadership roles. Some distributors need the latter to really move the needle.
Both can work. What matters is understanding the distance between where you are and where you need to go.
Develop Your Pricing Leaders
If everyone owns pricing, nobody owns it. Somebody in your business needs to live and breathe pricing full-time. Otherwise, margin opportunities get lost in the noise of everything else operations and sales have to handle.
Professional development matters, too. Nobody enters pricing full trained. I certainly didn’t. We have to invest in the people we want to trust with profitability. Conferences, peer communities, and training help them build the skills they need.
Pricing leaders must also spend time in the field with sales, in branches, watching how orders are entered and where the friction lives. The more connected pricing is to real work, the more impact it will have.
That said, you don’t have to build all the expertise you need overnight. If your pricing team is small or new to the work, outside support can help you make better decisions faster and avoid the common pitfalls of early pricing transformations. A fractional pricing advisor or coach can provide guidance until your internal team is ready to run on their own.
Focus Where Margin is Leaking Fastest
If you’re looking for a single move that can deliver measurable improvement—quickly—analyze and attack your price overrides. They are the clearest indicator of margin leaks and the easiest place to start turning things around.
When you clean up overrides by giving sales teams trustworthy pricing structures and guardrails, you will pick up margin lift without losing customers. This is also one of the simplest and fastest ways to build a business case that pricing deserves more attention and investment.
No More Excuses
Pricing is the one place where math and momentum will work in your favor. The only real risk is hesitation. Competitors who move to modernize their pricing function and develop their pricing organization will expand margin growth in 2026. But if your pricing strategy still depends on spreadsheets, tribal knowledge, or fear of upsetting customers, then it’s not a strategy at all. It’s a plan to lose margin slowly.
Scott Sinning founded Pricing for Distributors to help B2B distributors fix pricing problems to grow profits. He gained expertise as Vice President of Pricing Strategy at Graybar and spent his entire career in the wholesale distribution industry. He frequently writes and speaks on distributor pricing strategy and profitability topics. He is currently welcoming new clients and can be reached via email at scott@pricingfordistributors.com.