Excel vs Pricefx: What’s the Best Pricing Tool for You?
If you're part of a large enterprise or even a mid-sized business, you've likely heard the growing buzz: Excel's error-prone, time-consuming manual pricing management might not be the tool your company needs anymore. But why is there such a push to move away from Excel? What's driving this seismic shift? Dive into our head-to-head comparison of Excel vs. Pricefx pricing software to uncover why companies are making the switch and how you can address your pricing pain points now.
At Pricefx, as a leading cloud-native and AI-informed pricing software provider, we frequently hear from customers and prospects about the numerous headaches Excel causes in their pricing efforts. Many are painfully aware of the notorious pricing errors that have plagued Excel users in recent years. One particularly infamous incident involved Canadian electric power generator TransAlta, which lost $24 million in a contract purchase in the early 2000’s due to a simple manual entry copy/paste error in Excel. This single mistake wiped out 10% of their annual profits, highlighting the significant risks associated with relying on Excel for pricing management.
Many of our clients tell us that while Excel is a powerful tool, it was not designed to handle the complexities of today's pricing industry. Especially in the context of the current economic climate (with inflation and cost increases rife and the looming impact of a tariff-rich environment) , nobody could have predicted the need for managing dynamic price lists with hundreds of thousands of items in near real-time to avoid margin erosion.
If your company deals with only a few products priced uniformly across limited regions, pricing in Excel might suffice.
However, for those with extensive product lines, significant distribution costs, fluctuating raw material prices, or intricate rebate and discount structures, there is a better solution. Modern pricing software can help you break free from the manual input nightmare.
In our comprehensive Excel vs. Pricefx comparison, we examine the two tools across a range of criteria that can help you assess if you need to upgrade from Excel or not.
So, without further ado, let’s check out the criteria matchups on which to base our unbiased assessment.
Excel vs Pricefx Pricing Software – The Head-to-Head Criteria Examined
While it is true that not all software is created equally, each offers a unique set of functionalities. For this article, we have focused on how each software type—Excel vs Pricefx —performs tasks crucial to the pricing industry and how companies utilize them.
In other words, we have endeavored to compare like with like, rather than dissimilar items. However, given that they are inherently different tools (‘oranges vs apples’) designed for varied purposes, complete parity isn't always achievable. Nonetheless, we have strived to maintain an impartial perspective throughout.
With that in mind, consider these he top six criteria for our unbiased evaluation of Excel vs Pricefx:
1. How Much Does the Software Cost?
2. Which Software Provides the Most Automation?
3. Which Software Provides the Most Pricing Insight?
4. Which Software Model Makes It Easier for Me to Understand and Justify My Pricing?
5. Which System Can Handle the Most Data Points?
6. Is Pricefx or Excel Easiest to Integrate with Your Current System?
Now, let’s explore the criteria for our impartial assessment.
1. How Much Does the Software Cost?
Winner – Excel
Excel is very inexpensive compared to purchasing enterprise-grade pricing software like Pricefx. Excel is quick to set up, and most employees will potentially already know how to use it. While Excel is cheap, easy to learn, customize, and has useful computational features, its limitations become apparent as analytic and business needs grow.
What’s more, manual inputs increase the risk of human errors, especially with multiple users or versions. For example, statistics have shown that 88% of spreadsheets contain significant errors. Consequently, we can draw the conclusion that only 1 out of 10 spreadsheets shows accurate data. Do you want to manage pricing with that?
Excel is a great tool for small companies not facing growth challenges. However, for businesses with extensive product items, many customers, pricing rules, and variables, Excel may lack the necessary automation.
Yes, Pricefx will cost more, and this great article How Much Does Pricing Software Cost? will help provide an approximate price range for your enterprise’s needs.
However, as an enterprise business with an annual revenue of $4 billion or more, you could be looking at an average margin improvement of 8.4% which could add up to millions in extra profit added to your bottom line.
To help your business discover its value potential with Pricefx, check out this handy article below to learn more:
2. Which Software Provides the Most Automation?
Winner – Pricefx
Regardless of whether you already have or are considering purchasing either an on-premises first-generation or a native-cloud next-generation pricing software system like Pricefx, either way, it is a more automated system than an Excel spreadsheet.
Excel software requires humans to input data manually and do a stack of it! And with manual data input comes the potential for costly errors like we mentioned above.
If you have previously struggled with keep your pricing up to date in real time with Excel, (for example, tracking the impact on your prices of any promotional activities that were running), a quality pricing software solution like Pricefx takes away the stress, and automatically corrects your pricing. No sneaky margin leaks potentially eating into your profit as your pricing is in real-time and plenty of actionable insights supplied to help you price smarter and more profitably now and into the future.
For example, if you are interested in how Pricefx helps manufacturers with automating their pricing activities, click on the image below to learn more, or those interested in pricing automation in distribution or chemical pricing automation can click in these links provided, respectively.
3. Which Software Provides the Most Pricing Insight?
Winner – Pricefx
Pricefx provides a comprehensive view of pricing, covering list price, gross price, and net price. It includes advanced data analytics to identify business opportunities with actionable insights. Additionally, Pricefx AI Optimization ensures pricing is precise and aligned with specific business goals.
Pricefx provides a level of business agility that can easily adapt to changing market conditions that may dynamically shift rapidly and unexpectedly.
What’s more, Pricefx can give you the ability to look into the future and simulate the impact of your potential price lists on your business goals before you implement them. Check out the video below to learn more.
On the other hand, while Excel can present information in various types of charts, there is no ‘in-program’ drill down and easily accessible pricing insights. In Excel, you’ll need to cross-reference and use KPIs and metrics to highlight underperformance and run multiple ad-hoc analyses to discover your business opportunities.
However, extracting actionable pricing insights from Excel is a labor-intensive activity that means you may struggle to keep up with a cut-throat competitive market.
4. Which Software Model Makes It Easier for Me to Understand and Justify My Pricing?
Winner – Pricefx
Modern Next-Generation pricing software like Pricefx is what can be called a ‘clear box’ approach. But what does that really mean?
What that means is that the entire pricing software system is transparent, with full reasoning for price shifts provided for end-users and actionable insights supplied for what to do in the future to bring out whatever your organization has chosen your business to be.
Price Transparency can be a powerful tool.
As the price choices are constructed in real-time on the most up-to-date data, executives and salespeople can gain a clear sense of pricing and full visibility on how prices have calculated.
In a nutshell, Pricefx supplies all manner of employees in B2B companies with the full confidence to pass on price information to their clients and prospects that they know, understand, and can express with assurance and certainty.
Unlike Pricefx, Excel requires gathering scattered transaction data from across the business, which needs to be meticulously scanned for typos and human errors. Following this, the data must undergo complex calculations and be aggregated into a spreadsheet for use in VLOOKUP or Pivot Tables.
The result is often a "black box" of pricing that only a handful of people in the organization can understand, troubleshoot, or replicate without creating multiple versions of the same document.
A black box can lead to confusion and, worse, distrust or a lack of understanding of prices among sales staff. Moreover, your margins can be eroded without anyone in your business realizing it, due to the extensive amount of analysis required in Excel.
5. Which System Can Handle the Most Data Points?
Winner – Pricefx
Alright, it is fair to say that Excel technically can handle as many data points as any automated pricing software platform. But just stop for a moment and think about the workforce you would need to match the analytical speed of an AI-powered pricing tool like Pricefx. Does your enterprise-level organization manage the prices of something in the order of 10,000 to 100,000 products? So, in that case, are we talking 1,000, 10,000, or even a million people working around the clock in Excel spreadsheets?
In today's cutthroat business environment, there is no room for manual data entry mistakes or the limitations of Excel. You need the precision and speed of an AI-informed pricing system.
Pricing software like Pricefx gives you unique customer insights, accurate historical data, real-time cost and inventory updates, and even factors in competitive prices, index prices, real-time exchange rates, search engine algorithms, and local weather data to help you capture value.
As customers and markets become more transparent, businesses need to connect to multiple internal and external data sources to stay competitive.
Pricefx makes that possible.
6. Is Excel or Pricefx Easiest to Integrate with Your Current System?
Tie – Pricefx/Excel - depending on your company’s size, range of offerings and geographies operated in and overall complexity.
To revisit what we discussed about your business's complexity and its pricing needs, if your operations are straightforward—with only a few products, stable prices, and a single region to manage—manual Excel spreadsheets might be sufficient. Integration with other systems might not be necessary for you.
However, if your pricing team needs more sophisticated tools for making decisions and handling large volumes of data from various sources, you will need a user-friendly method to turn that data into valuable insights. Enter automated pricing software like Pricefx.
Excel, while a standalone powerhouse, is not known for communicating well with other systems. Without exceptional technical expertise, your pricing team might spend more time gathering data than devising strategies. Permanent data catch-up is not ideal.
Conversely, you will not have Pricefx ready and fully operational in minutes like Excel. It is a robust tool that requires time to set up—typically about six weeks at a minimum. But once in place, it dramatically enhances what you can achieve and simplifies the pricing process.
Post-integration with Pricefx, you will benefit from:
- Revenue and profitability tracking over time and by geography
- Analysis of top and bottom-performing products and customers
- Price waterfall analysis and comparisons over different periods, products, and customers
- Detailed revenue and margin breakdowns
- ...and much, much more
But is Pricefx the Best for Your Business & if so, How Long Does it Take to Implement it?
Between Excel and Pricefx, you now have ample information to help your organization select the most suitable pricing tool.
If you are an enterprise business, you have possibly already realized that Excel no longer meets your pricing needs.
But is Pricefx the right tool for you, or would another pricing software be a better fit? At Pricefx, we have spent over a decade listening to various enterprise companies about the challenges they face in choosing a pricing software solution.
To assist you further, here are some direct comparisons between Pricefx and other enterprise-level pricing software vendors:
And once you have decided, you’ll also want to know the nitty-gritty about how long it will take to get started with pricing smartly as you mean to go on:
Happy Pricing!
Idrissa Diop
Principal Solution Strategist , Pricefx
Idrissa Diop has over a decade of experience in pricing. As a Principal Solution Strategist at Pricefx, Idrissa helps companies to improve their pricing processes, profit, and growth with software. His expertise ranges from defining a pricing strategy to pricing strategy audits and competitive analysis.