Price increase calculator

Raising prices usually costs some customers. This shows how many sales you could lose after a price rise and still make the same gross profit as today, and what you gain if nobody leaves. Nothing is saved or sent anywhere.

Variable cost = what each extra sale costs you: materials, stock, packaging, payment fees, delivery. Fixed costs such as rent do not change with a price rise, so equal gross profit means equal profit. The prefilled numbers are a made-up worked example, not typical figures: replace them with your own.

How it works

New price = price × (1 + change %). Gross profit per sale = price − variable cost. Sales needed after the change = current sales × current gross profit per sale ÷ new gross profit per sale. Sales you can lose = current sales − sales needed. As a share: price increase ÷ (new price − variable cost).

Worked example (the values above): a $50.00 sale that costs $20.00 leaves $30.00, so 200 sales a month make $6,000.00 of gross profit. A 10% rise takes the price to $55.00 and the gross profit per sale to $35.00. You now need only $6,000.00 ÷ $35.00 = 171.4 sales for the same $6,000.00, so you could lose 200 − 171.4 = 28.6 sales a month (14.3%, which is $5.00 ÷ $35.00) and be no worse off. If nobody leaves, gross profit rises to 200 × $35.00 = $7,000.00, $1,000.00 more.

It works the other way too: a 10% price cut to $45.00 leaves $25.00 a sale, so you would need $6,000.00 ÷ $25.00 = 240 sales, 40 more (20.0%), just to stand still. See also the customer lifetime value calculator and all calculators.