Pricing under pressure: Closing the gap between cost pressure and margin realization

Facing rising costs, geopolitical disruption, and supply chain volatility, most companies are leaving money on the table; not because they don't want to raise prices, but because the increases they achieve fall short of what they planned.

Our research consistently shows a striking disconnect. Companies that set out to recover cost increases through price adjustments rarely realize their full ambition. We observe two gaps.

There is first an ambition gap: the distance between actual cost increases and the price increase companies dare to pursue. And then there is the realization gap: the further erosion between what companies plan to charge and what they actually collect, once discounts, exceptions, and customer pushback have taken their toll.

In an environment shaped by ongoing trade disruptions, inflationary pressure, and geopolitical uncertainty, this compounding shortfall is no longer manageable. Every…