Pricing

Net-net price / cost

Price or cost after all rebates and allowances — on the sell side, what you keep; on the buy side, what you truly paid.

For a distributor, net-net cost is the item cost after every supplier rebate and allowance, and it is the number pricing, quoting and margin reporting should all use. In most distributors it is not available at the line, so all three run on gross cost.

The consequence is a systematically wrong mix: rebate-rich lines are priced too high and lost, rebate-poor lines are priced too low and won. The P&L cannot explain it because the rebates arrive in a different period as a lump sum that looks like good news.

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