Profit impact of raising prices X%. The Price Increase Impact Calculator takes current price, variable cost per unit, units sold per period, price increase, expected change in volume (negative for a fall) and returns change in profit plus profit after the change, profit today, new price, volume you could lose and still match today's profit. Results update as you type, and the formula is shown under the result so you can repeat it in your own spreadsheet.
Good business decisions come from putting numbers on the options before committing. Run the calculation with your best estimate, then again with a pessimistic one, and see whether the decision survives both. Use the worked example below to check the maths against your own figures.
How the Price Increase Impact Calculator works
Because price rises fall straight through to profit, a business can usually lose more customers than it fears and still come out ahead. The calculator shows the volume loss you could absorb.
Worked example
With the example values (current price of $100, variable cost per unit of $60, units sold per period of 1000, price increase of 10%, expected change in volume (negative for a fall) of -5%), the change in profit is $7,500.00; profit after the change $47,500.00, profit today $40,000.00, new price $110.00, volume you could lose and still match today's profit 20%. Change any figure above and the result updates immediately; use Copy results to paste the summary into a note or email.
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Frequently Asked Questions
How is change in profit calculated?
profit = (price − variable cost) × units; the last figure is the volume drop at which the new profit equals the old.
Which figures do I need?
Current price, variable cost per unit, units sold per period, price increase, expected change in volume (negative for a fall). Take them from the same period and the same set of accounts or reports so the ratio is consistent, and check the example values as a guide to the units expected.
How reliable is the result?
As reliable as the estimates you enter. Run the calculation with optimistic and pessimistic inputs to see the range of outcomes before deciding.
