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Methodology

Commerce Platform Plan Break-even Planner methodology

Find the sales level where a higher fixed-fee platform plan pays back.
Duc Nguyen X.By Duc Nguyen X.· Founder, Margin101Last reviewed: View update historyMethodology

Educational only: Business decision support, not accounting, tax or legal advice.

Privacy: Calculations run locally; Margin101 does not receive your commercial inputs.

Update policy: Reviewed when formulas or official dependencies change.

Scope: Market-neutral small-business planning using your own assumptions.

1. Formulas and units

Basic Total Fees Ex Tax
basicTotalFeesExTax = basic fixed fee + sales fee + order fees

Where

basicFixedFeePerOrderExTax
Basic fixed order fee (currency units, ex tax)Source: Business record
basicTotalFeesExTax
Basic Total Fees Ex Tax (currency units, ex tax)Source: Calculated output
Advanced Total Fees Ex Tax
advancedTotalFeesExTax = advanced fixed fee + sales fee + order fees

Where

advancedFixedFeePerOrderExTax
Advanced fixed order fee (currency units, ex tax)Source: Business record
advancedTotalFeesExTax
Advanced Total Fees Ex Tax (currency units, ex tax)Source: Calculated output
Fee Saving Ex Tax
feeSavingExTax = basic fees − advanced fees

Where

basicTotalFeesExTax
Basic Total Fees Ex Tax (currency units, ex tax)Source: Calculated output
advancedTotalFeesExTax
Advanced Total Fees Ex Tax (currency units, ex tax)Source: Calculated output
feeSavingExTax
Fee Saving Ex Tax (currency units, ex tax)Source: Calculated output
Basic Retained Contribution Ex Tax
basicRetainedContributionExTax = pre-fee contribution − basic fees

Where

basicTotalFeesExTax
Basic Total Fees Ex Tax (currency units, ex tax)Source: Calculated output
basicRetainedContributionExTax
Basic Retained Contribution Ex Tax (currency units, ex tax)Source: Calculated output
Advanced Retained Contribution Ex Tax
advancedRetainedContributionExTax = pre-fee contribution − advanced fees

Where

advancedTotalFeesExTax
Advanced Total Fees Ex Tax (currency units, ex tax)Source: Calculated output
advancedRetainedContributionExTax
Advanced Retained Contribution Ex Tax (currency units, ex tax)Source: Calculated output
Crossover Monthly Sales Ex Tax
crossoverMonthlySalesExTax = fixed fee difference / transaction-rate saving

Where

monthlySalesExTax
Monthly sales (currency units, ex tax)Source: Business record
feeSavingExTax
Fee Saving Ex Tax (currency units, ex tax)Source: Calculated output
crossoverMonthlySalesExTax
Crossover Monthly Sales Ex Tax (currency units, ex tax)Source: Calculated output

Money inputs and outputs use the currency selected in the scenario without changing the canonical methodology. Rates, margins, utilisation and buffers are entered as percentages and converted to decimal values for calculation.

2. Worked example

Input assumptions

The worked rows below come directly from the registered engine and visible default fixture.

Calculation and outputs

Example

The worked rows below come directly from the registered engine and visible default fixture.

Basic Total Fees Ex Tax
1,050 currency units
Advanced Total Fees Ex Tax
850 currency units
Fee Saving Ex Tax
200 currency units
Basic Retained Contribution Ex Tax
18,950 currency units
Advanced Retained Contribution Ex Tax
19,150 currency units
Crossover Monthly Sales Ex Tax
30,000 currency units

The exact engine-derived outputs are shown in the labelled rows below.

Interpretation

The crossover shows the monthly sales level where the advanced plan recovers its higher fixed fee through lower transaction charges.

3. Validation and boundary checks

  • All values must be finite and inside the visible validation boundaries.
  • Rates are entered as percentages and calculations retain decimal precision.
  • Money uses one consistent ex-tax currency and planning period.

4. Assumptions and source classification

  • Provider fees, exchange rates, return behaviour and operating performance are user-entered scenarios.
  • No provider plan, jurisdiction, tax rate or market benchmark is embedded.
  • The engine retains full precision and display formatting never feeds back into calculation.

This planner has no current policy-data dependency. Its commercial assumptions are user supplied. Registered family-level regression suites exercise the shared business-logic engine and worked-result reconciliation.

5. Limitations

  • The model does not forecast demand, provider changes, exchange rates or operational performance.
  • It does not replace accounting, tax, legal or financial advice.
  • Plan fees are editable contract inputs; included features, payment-provider interactions, tax, overage tiers, negotiated rates and plan eligibility are outside the crossover calculation.

This is educational decision support, not tax, accounting, legal or financial advice. Check the treatment of your actual transactions under the rules that apply to your business and seek qualified advice where appropriate.

6. Update and evidence policy

Registered family-level suites test formula invariants and example reconciliation; the release ledger records that coverage without claiming a separate oracle for every line of public copy. There is no official threshold or benchmark to refresh for this planner. Commercial inputs remain user-supplied because they vary by business and contract.

Change history

  1. : Initial public release of the planner and methodology after pre-launch calculation, content, source and interaction review.

Related reading

Guides to interpret the decision and its assumptions.

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