Trade Pricing Is Channel Design, Not a Discount

Most trade suppliers get pricing wrong because they treat trade pricing like a simple discount. It isn't. It's how you build your sales channel.

Your trade terms decide if a designer can price you, present you, and keep using you — without drama.

The Basic Misunderstanding

Most suppliers assume a 20% trade discount means the designer earns 20%. It doesn't.

Designers do real work around your product. They also carry risk.

When they specify you, they take on:

So a 20% discount often isn't "profit". It's what funds the process. If your terms don't leave room for that, they'll stop specifying you. Simple.

The Retail Transparency Problem

Public retail pricing changes the conversation. Most designers don't hide the trade price. They show it. Then they add a procurement percentage/fee on top. That's how the service gets paid for.

Here's where it breaks:

Now the designer has to explain why Trade + procurement % is higher than your public retail price.

That's not a "sales objection". It's a structural clash. And it's a spec-killer because it makes the designer look like they've added "extra" cost, it creates mistrust right when the designer needs smooth approval, and it pushes the designer to choose a supplier whose pricing doesn't create the same trap.

The fix is straightforward: don't force the designer into that contradiction. Either keep retail pricing less visible, or make trade terms deep enough that the designer can add their procurement fee and still land below (or comfortably in line with) your public retail.

Pricing Sets Your Tier

In high-end interiors, price is a signal. Too cheap doesn't read as "good value". It reads as "risky".

Designers avoid products that feel underpriced because it can suggest quality is inconsistent, the brand isn't stable, and clients will question the choice.

Lowering price to win more specs often does the opposite. Designers aren't chasing the cheapest option. They're chasing the option they can justify — fast, clean, and with confidence.

Your pricing needs to match the tier you want to play in. If the product is premium but the price feels mid-market, trust drops.

Trade Pricing Is Channel Design

Stop asking: "What discount should I offer?" Ask: "Can a designer specify this without losing money or losing face?" That's the job of trade pricing.

A strong structure does four things:

If your terms create friction, designers won't "push through". They'll choose the supplier that's easier to run through their business.

The "Standard Discount" Trap

A flat 20% trade discount is common because it's easy. But "common" isn't the same as "works".

Whether 20% is enough depends on how much work your product creates (custom, lead times, coordination), how visible your retail pricing is, what the designer must carry (cashflow, liability), and what other suppliers in your category offer.

If specifying you is heavy, 20% often collapses. If specifying you is light, 20% might be fine.

The point: trade pricing isn't a default setting. It's a deliberate structure.

What to Do Now

If you want more specification, make your trade terms easy to use.

A good checklist:

This isn't about being generous. It's about being specify-able.

The Bottom Line

Trade pricing isn't a "margin tweak". It's the structure that decides if designers can sell you.

Get it right and you become easy to specify — again and again. Get it wrong and you create friction: price conflicts, awkward client conversations, and quiet substitution.

As we covered in a previous post, designers aren't your end client. They're your route to the end client. Your trade terms are how you make that route viable.

If the numbers don't work, you won't get specified. And you won't always know why.