The method
How it is worked out
Cost-plus = cost ÷ (1 − margin); Value = value × capture; Anchored = competitor × (1 + position); profit = (price − cost) × demand
- elasticity
- How much demand changes for each 10% change in price
Pricing Strategy Calculator
Compare cost-plus, value-based and competitor-anchored prices for a product and see the profit each one produces. The result updates as you type so you can compare scenarios quickly.
Keep in mind
What it leaves out
- Elasticity is a guessTest two prices with real customers before committing.
- SegmentsDifferent customers value the product differently; consider tiers.
- Costs changeCost-plus prices drift with input costs; revisit quarterly.
Use the calculator to compare scenarios rather than as a guaranteed forecast.
About the Pricing Strategy Calculator
Compare cost-plus, value-based and competitor-anchored prices for a product, estimate how demand responds to each, and see which price produces the most profit rather than the most revenue.
How it works and an example to tryShow less
How to use the result
Cost-plus divides unit cost by one minus the margin. Value-based multiplies customer value by the share you can capture. Competitor-anchored applies your positioning to the competitor's price. Demand at each price is adjusted by the elasticity entered, and profit is price less cost times demand.
Example to try
Unit cost £32, target margin 45%, customer value £150 with 40% capture and a competitor at £69: cost-plus £58.18, value £60, anchored £65.55. With demand falling 15% per 10% price rise, the anchored price earns most.
Put it to work
Try it on a real situation
Load an example
What moves the result most
Worked out from your figures above. Tap a row to try it.
Who uses it, and when
Product managers, founders launching a first product, small manufacturers and service businesses reviewing a price list.
Mistakes worth avoiding
- Pricing from cost alone and leaving value on the table.
- Guessing elasticity and never testing a second price.
- Copying competitors who may themselves be underpricing.
Questions
What does the Pricing Strategy Calculator do?
Compare cost-plus, value-based and competitor-anchored prices for a product and see the profit each one produces.
How should I use the result?
Cost-plus divides unit cost by one minus the margin. Value-based multiplies customer value by the share you can capture. Competitor-anchored applies your positioning to the competitor's price. Demand at each price is adjusted by the elasticity entered, and profit is price less cost times demand.
Does TechBullion store the information I enter?
The core calculation or transformation runs in your browser. Normal website security and analytics may still record page-level events, but the tool does not need to create a public record from your inputs.
What mistakes do people make with a pricing strategy calculator?
Pricing from cost alone and leaving value on the table. Guessing elasticity and never testing a second price. Copying competitors who may themselves be underpricing.
Is the result guaranteed?
No. Use the result as a practical check or planning aid and verify important decisions with the relevant primary source, provider or professional advice.
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Results are estimates based on the figures entered, for general information only, and not financial, investment, tax or legal advice. See our terms of use.