# Price position

Price position is where your price sits against the market for a comparable product at a point in time: above, level with or below your competitors.

- **Is:** Where your price sits against comparable competitor prices at one point in time.
- **Read:** Actual position against the intended one, such as within 3% of two named competitors.
- **Watch for:** Gaps against a competitor that is out of stock or matched to the wrong product.

## What it means for retail and category teams

Price position describes one moment. A useful statement of it names the product, the competitors it was measured against, how closely the products match and when the prices were observed. It is usually expressed as a percentage gap or an index.

It should be read alongside availability. A competitor that is cheaper but out of stock cannot win that sale, and a gap that has lasted a day means something different from one that has lasted a month.

## Why it matters

Pricing strategies are usually expressed as intended positions, such as matching a key competitor on known-value items or sitting a few per cent above on premium lines. Measuring actual position against intended position shows where prices have drifted. The gap is a signal to investigate, because margin, supplier funding and how price-sensitive shoppers are on that line all bear on whether to move.

## How Twelfth handles this

In twelfth's Tracked set, each row shows the observed price position against up to four competitor columns, with a filter for lines where your price is materially over any shown competitor, and it marks a matched retailer that is out of stock. The product's own guidance is to treat a price position as a prompt: margin, funding, sales response and the seller relationship all need checking before a price changes.

## Illustrative example

The business and figures are illustrative. None of it is customer data.

A category manager's policy is to sit within 3% of two named competitors on 40 key lines. A weekly read shows 34 lines inside the band, four lines more than 3% above both competitors, and two lines where one competitor is cheaper but has been out of stock all week. The four lines go to review; the team notes the two out-of-stock comparisons and leaves those prices alone.

**40 key lines against a 3% band around two competitors**

- Inside the band: 34
- More than 3% above both: 4
- Cheaper competitor out of stock: 2
- Result: 4 lines to review

Six lines sit outside the band, and only four of those gaps are real.

## Related concepts

- [Price index](https://twelfth.ai/glossary/price-index): Turn an individual matched price into a consistent measure around parity.
- [Price intelligence](https://twelfth.ai/glossary/price-intelligence)
- [Matched SKU](https://twelfth.ai/glossary/matched-sku): Check the match before treating a price gap as a reason to move.
- [Gross-profit floor](https://twelfth.ai/glossary/gp-floor)

## Next step

### Look at the price gaps that matter

Bring a few products and competitors. We can walk through matching, observation dates and which gaps deserve a closer look.

- [Book a demo](https://twelfth.ai/book-a-demo)
- [Category management software for retail | Twelfth](https://twelfth.ai/for/category-managers): Retail category management software that briefs category managers overnight, with pricing, promo and margin decisions in one workspace. Book a demo.

Source: https://twelfth.ai/glossary/price-position