Educational only: Business decision support, not accounting, tax or legal advice.
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Update policy: Reviewed when formulas or official dependencies change.
Scope: Market-neutral small-business planning using your own assumptions.
What this planner helps you decide
Best for
Product and service businesses reviewing a selling price against unit cost.
Outputs
Target price before indirect tax, gross profit, markup and the change from an optional current price.
Start here
Enter the full unit cost, choose a target margin and compare the result with your current price.
Use a different tool when: Do not use this to find whether added volume can recover profit after a discount; use Discount Profit Impact Planner for that decision. Use this tool to set a price for a target gross margin.
Decision pack · Step 2 of 5
Protect Margin
Move from a supplier-cost shock to a defensible price, realistic sales threshold and cash-impact check.
- 1. Measure the cost shock
- 2. Set the target price
- 3. Test allowable volume change
- 4. Confirm break-even
- 5. Review cash impact
Current decision: What selling price protects the intended gross margin?
Next: Test whether the implied volume response is realistic.Price & margin
Target Margin & Pricing: target price before indirect tax
Target price before indirect tax, gross profit, markup and the change from an optional current price.
Amounts use the same currency as your inputs. No currency conversion is performed.
Pricing assumptions
Enter the unit cost and gross margin you want the selling price to achieve.
Your numbers stay in this browser
Direct and allocated unit cost before indirect tax.
Gross profit as a percentage of the ex-indirect tax selling price. This differs from markup, which is measured against cost.
Compare with current price — optionalAdd today's ex-indirect tax selling price to see the exact increase or decrease required.
Used only to compare today's price with the price required for your target margin.
indirect tax settingsOpen the assumptions you are less likely to change on every comparison.
Editable tax scenario; confirm the treatment of your sale.
Price required to reach 40% gross margin
Calculated from the assumptions shown; this is not a pricing recommendation.
At a 40% gross margin, a unit costing 60.00 ex indirect tax needs to sell for 100.00 ex indirect tax. That produces 40.00 gross profit per unit and is equivalent to a 66.7% markup on cost.
Share and export actions never include your numbers in the page link.
PDF and CSV exports stay on this device. Clean page links contain no inputs.
Scenario comparison
Compare today's ex-indirect tax price with the target price and the exact change required.
ScenarioResultDifference
Current selling price90.00Baseline
Target price at 40% gross margin100.00+10.00 (+11.1%)
Save these results, change an input, then compare the updated figures with this baseline.
The baseline is temporary in this tab and is not added to shared scenario links or generated reports.
Calculation details
View calculation detailsView the formulas and inputs used for these results.
Required selling price, ex indirect tax
Target price ex indirect tax
cost ÷ (1 − target margin)100 ex indirect taxResult100.00
Per unit, excluding indirect tax, at the entered target gross margin. Displayed to the nearest cent; the engine retains full precision.
Target-margin pricing formula →Inputs used by these formula steps
- Target price ex indirect taxCost Ex indirect tax
- 60
- Target price ex indirect taxTarget Margin
- 0.4
Customer price, including indirect tax
Target price ex indirect tax
cost ÷ (1 − target margin)100 ex indirect taxCustomer price including indirect tax
price ex indirect tax × (1 + indirect tax rate)100 inc indirect taxResult100.00
Per unit, including the editable indirect tax scenario. Displayed to the nearest cent; the engine retains full precision.
Target-margin pricing formulas →Inputs used by these formula steps
- Target price ex indirect taxCost Ex indirect tax
- 60
- Target price ex indirect taxTarget Margin
- 0.4
- Customer price including indirect taxPrice Ex indirect tax
- 100
- Customer price including indirect taxindirect tax Rate
- 0
Gross profit per unit
Target price ex indirect tax
cost ÷ (1 − target margin)100 ex indirect taxGross profit
price ex indirect tax − cost ex indirect tax40.00Result40.00
Per unit, excluding indirect tax; this is not net profit. Displayed to the nearest cent; the engine retains full precision.
Gross-profit formula →Inputs used by these formula steps
- Target price ex indirect taxCost Ex indirect tax
- 60
- Target price ex indirect taxTarget Margin
- 0.4
- Gross profitPrice Ex indirect tax
- 100
- Gross profitCost Ex indirect tax
- 60
Markup on cost
Target price ex indirect tax
cost ÷ (1 − target margin)100 ex indirect taxGross profit
price ex indirect tax − cost ex indirect tax40.00Markup
gross profit ÷ cost ex indirect tax66.67%Result66.7%
Gross profit divided by ex-indirect tax unit cost; markup is not gross margin. Displayed to two percentage decimal places.
Markup formula →Inputs used by these formula steps
- Target price ex indirect taxCost Ex indirect tax
- 60
- Target price ex indirect taxTarget Margin
- 0.4
- Gross profitPrice Ex indirect tax
- 100
- Gross profitCost Ex indirect tax
- 60
- MarkupGross Profit
- 40
- MarkupCost Ex indirect tax
- 60
Inputs used
- Cost per unit, ex indirect tax
- 60.00
- Current selling price, ex indirect tax (optional)
- 90.00
- Target gross margin
- 40%
- indirect tax rate
- 0%
Supporting pricing checks
Use these modules to reconcile percentages, test cost-plus pricing, make a price-floor assumption and normalise a indirect tax scenario. They do not recommend a price.
Owner presets
Load an illustrative starting configuration. These are editable examples, not market benchmarks or recommended prices.
Supporting pricing calculations
Each card is an editable mode of this pricing owner. Currency and indirect tax rates are user-entered; no country, tax authority or market default is assumed.
Markup calculator
66.7% markup · 40.00 gross profit · 40% margin.
Margin calculator
40% margin · 40.00 gross profit · 66.7% markup.
Cost-plus pricing
90.00 excluding tax · 90.00 including tax · 33.3% margin.
Inclusive ↔ exclusive indirect tax
Uses the same user-entered indirect tax rate shown in cost-plus pricing.
100.00 excluding tax · 100.00 including tax · 0.00 tax.
Calculation details
View calculation detailsView the formulas and inputs used for these results.
Markup on cost
Markup calculator
markup = (selling price − cost) ÷ cost66.67%Result66.7%
Gross profit divided by entered cost. Displayed as a percentage; raw engine precision is retained.
Markup calculator formula →Inputs used by these formula steps
- Markup calculatorCost
- 60
- Markup calculatorSelling Price
- 100
Gross profit
Markup calculator
markup = (selling price − cost) ÷ cost66.67%Result40.00
Selling price less cost, on the same tax basis. Displayed to two decimals; raw engine precision is retained.
Markup calculator formula →Inputs used by these formula steps
- Markup calculatorCost
- 60
- Markup calculatorSelling Price
- 100
Gross margin
Margin calculator
margin = (revenue − cost) ÷ revenue40%Result40%
Gross profit divided by entered revenue. Displayed as a percentage; raw engine precision is retained.
Margin calculator formula →Inputs used by these formula steps
- Margin calculatorRevenue
- 100
- Margin calculatorCost
- 60
Gross profit from revenue
Margin calculator
margin = (revenue − cost) ÷ revenue40%Result40.00
Revenue less cost, on the same tax basis. Displayed to two decimals; raw engine precision is retained.
Margin calculator formula →Inputs used by these formula steps
- Margin calculatorRevenue
- 100
- Margin calculatorCost
- 60
Cost-plus price excluding tax
Cost-plus pricing
(direct cost + allocated overhead) × (1 + markup) × (1 + tax rate)90.00Result90.00
Direct cost plus allocated overhead, then the entered markup. Displayed to two decimals; raw engine precision is retained.
Cost-plus pricing formula →Inputs used by these formula steps
- Cost-plus pricingDirect Cost
- 50
- Cost-plus pricingAllocated Overhead
- 10
- Cost-plus pricingMarkup
- 0.5
- Cost-plus pricingTax Rate
- 0
Cost-plus price including tax
Cost-plus pricing
(direct cost + allocated overhead) × (1 + markup) × (1 + tax rate)90.00Result90.00
The caller-entered indirect tax rate is added after markup. Displayed to two decimals; raw engine precision is retained.
Cost-plus pricing formula →Inputs used by these formula steps
- Cost-plus pricingDirect Cost
- 50
- Cost-plus pricingAllocated Overhead
- 10
- Cost-plus pricingMarkup
- 0.5
- Cost-plus pricingTax Rate
- 0
Amount excluding indirect tax
Inclusive and exclusive indirect tax conversion
inclusive amount = exclusive amount × (1 + tax rate)100.00Result100.00
Bidirectional conversion using only the entered rate. Displayed to two decimals; raw engine precision is retained.
Inclusive and exclusive tax conversion →Inputs used by these formula steps
- Inclusive and exclusive indirect tax conversionMode
- exclusive
- Inclusive and exclusive indirect tax conversionAmount
- 100
- Inclusive and exclusive indirect tax conversionTax Rate
- 0
Amount including indirect tax
Inclusive and exclusive indirect tax conversion
inclusive amount = exclusive amount × (1 + tax rate)100.00Result100.00
Bidirectional conversion using only the entered rate. Displayed to two decimals; raw engine precision is retained.
Inclusive and exclusive tax conversion →Inputs used by these formula steps
- Inclusive and exclusive indirect tax conversionMode
- exclusive
- Inclusive and exclusive indirect tax conversionAmount
- 100
- Inclusive and exclusive indirect tax conversionTax Rate
- 0
Inputs used
- Indirect tax rate
- 0%
- Cost and price basis
- Entered on a consistent basis unless the converter explicitly changes it
Open additional pricing checksOptional margin/markup, cost-plus, price-floor and indirect tax arithmetic checks.
Margin ↔ markup
40% margin equals 66.7% markup.
Cost-plus scenario
90.00 ex indirect tax · 90.00 inc indirect tax · 33.3% margin.
Minimum price-floor assumption
100.00 ex indirect tax floor from direct cost, allocated cost and the contribution you entered.
indirect tax retained-margin scenario
44.00 retained gross profit · 40% retained margin.
This arithmetic scenario uses the displayed indirect tax rate only. Confirm registration, taxable-sale treatment and credit eligibility against your records or adviser.
Calculation details
View calculation detailsView the formulas and inputs used for these results.
Converted margin
Margin conversion
margin = entered ratio40%Result40%
Margin is gross profit divided by selling price. Displayed to two percentage decimal places.
Margin and markup conversion →Inputs used by these formula steps
- Margin conversionMode
- margin
- Margin conversionEntered Ratio
- 0.4
Converted markup
Markup conversion
markup = margin ÷ (1 − margin)66.67%Result66.7%
Markup is gross profit divided by cost. Displayed to two percentage decimal places.
Margin and markup conversion →Inputs used by these formula steps
- Markup conversionMode
- margin
- Markup conversionEntered Ratio
- 0.4
Cost-plus price excluding indirect tax
Cost-plus scenario
price ex indirect tax = cost ex indirect tax × (1 + markup)90/unit ex indirect taxResult90.00
Per unit, excluding indirect tax. Displayed to the nearest cent; the engine retains full precision.
Cost-plus pricing formula →Inputs used by these formula steps
- Cost-plus scenarioCost Ex indirect tax
- 60
- Cost-plus scenarioMarkup
- 0.5
Cost-plus customer price
Cost-plus scenario
price ex indirect tax = cost ex indirect tax × (1 + markup)90/unit ex indirect taxCost-plus customer price
price ex indirect tax × (1 + indirect tax rate)90 inc indirect taxResult90.00
Per unit, including the registered indirect tax-rate scenario. Displayed to the nearest cent; the engine retains full precision.
Cost-plus indirect tax formula →Inputs used by these formula steps
- Cost-plus scenarioCost Ex indirect tax
- 60
- Cost-plus scenarioMarkup
- 0.5
- Cost-plus customer pricePrice Ex indirect tax
- 90
- Cost-plus customer priceindirect tax Rate
- 0
Cost-plus margin
Cost-plus scenario
price ex indirect tax = cost ex indirect tax × (1 + markup)90/unit ex indirect taxCost-plus margin
gross profit ÷ price ex indirect tax33.33%Result33.3%
Gross profit divided by ex-indirect tax selling price. Displayed to two percentage decimal places.
Cost-plus margin formula →Inputs used by these formula steps
- Cost-plus scenarioCost Ex indirect tax
- 60
- Cost-plus scenarioMarkup
- 0.5
- Cost-plus marginGross Profit
- 30
- Cost-plus marginPrice Ex indirect tax
- 90
Minimum price-floor assumption
Minimum price-floor scenario
direct cost + allocated cost + minimum contribution100/unit ex indirect taxResult100.00
Per unit, excluding indirect tax; this is an assumption check, not a recommendation. Displayed to the nearest cent; the engine retains full precision.
Minimum price-floor formula →Inputs used by these formula steps
- Minimum price-floor scenarioDirect Cost Ex indirect tax
- 60
- Minimum price-floor scenarioAllocated Cost Ex indirect tax
- 10
- Minimum price-floor scenarioMinimum Contribution
- 30
Retained gross profit
Retained revenue
customer price under the selected indirect tax treatment110 per entered transactionRetained cost
supplier cost under the selected input-credit treatment66 per entered transactionRetained gross profit
retained revenue − retained cost44 per entered transactionResult44.00
Per entered transaction under the selected indirect tax arithmetic scenario. Displayed to the nearest cent; the engine retains full precision.
Retained gross-profit formula →Inputs used by these formula steps
- Retained revenueCustomer Price Inc indirect tax
- 110
- Retained revenueindirect tax Rate
- 0
- Retained revenueRegistered Taxable Scenario
- Yes
- Retained costSupplier Cost Inc indirect tax
- 66
- Retained costindirect tax Rate
- 0
- Retained costEligible Input Credit Scenario
- Yes
- Retained gross profitRetained Revenue
- 110
- Retained gross profitRetained Cost
- 66
Retained margin
Retained gross profit
retained revenue − retained cost44 per entered transactionRetained margin
retained gross profit ÷ retained revenue40%Result40%
Retained gross profit divided by retained revenue. Displayed to two percentage decimal places.
Retained margin formula →Inputs used by these formula steps
- Retained gross profitRetained Revenue
- 110
- Retained gross profitRetained Cost
- 66
- Retained marginRetained Gross Profit
- 44
- Retained marginRetained Revenue
- 110
Inputs used
- Percentage entered as
- Gross margin
- Percentage to convert
- 40%
- Cost, ex indirect tax
- 60.00
- Cost-plus markup
- 50%
- Allocated cost, ex indirect tax
- 10.00
- Minimum contribution per unit
- 30.00
- Customer price, incl indirect tax
- 110.00
- Supplier cost, incl indirect tax
- 66.00
- indirect tax rate
- 0%
- indirect tax registration and taxable-sale scenario
- Applies
- Supplier indirect tax input-credit scenario
- Eligible
Next step: test the price-volume trade-off
Test whether the sales volume implied by a proposed price is operationally plausible.
Open Price–Volume Trade-off PlannerOpen this calculator with preset values
This calculator supports documented, shareable scenario URLs. Compatible assistants and applications can construct links using the parameters below.
Scenario links contain only allowlisted numeric and closed-choice inputs shown in the URL; Margin101 excludes free text and identifying fields. Anyone you share the URL with can read those numbers, so do not include private or identifying data.
| Parameter | Meaning | Unit | Allowed values | Presence | Default |
|---|---|---|---|---|---|
| costExGst | Direct and allocated unit cost before indirect tax. | currency units/product unit, ex indirect tax | 0.01 to 10000000 | Required | 60 |
| currentPriceExGst | Used only to compare today's price with the price required for your target margin. | currency units/product unit, ex indirect tax | 0.01 to 10000000 | Optional | 90 |
| gstRate | Editable tax scenario; confirm the treatment of your sale. | proportion of ex-tax price charged as indirect tax | 0 to 1 | Required | 0 |
| targetMargin | Gross profit as a percentage of the ex-indirect tax selling price. This differs from markup, which is measured against cost. | proportion of selling price retained as gross profit | 0 to 0.95 | Required | 0.4 |
Target Margin & Pricing: target price before indirect tax
Treat the target price as a margin benchmark, then check whether customers and competitors support the proposed position.
Formula summary
- Primary formula
- price ex indirect tax = cost ex indirect tax ÷ (1 − target margin)
Data used here
- The estimate uses your inputs and the general business formula documented in the methodology.
Decision checks
Act on the result
Compare the target with your current selling price and document the cost, value or positioning reason for any increase.
Stress-test the decision
Retest the price with a higher full unit cost or a lower target margin before changing a live price list.
When this estimate can be misleading
- This is a gross-margin planning view, not net profit.
- indirect tax applies only when the sale is taxable and the business is registered or required to register.
- Your cost and target margin are assumptions, not industry benchmarks.
- Treat the target price as a margin benchmark, then check whether customers and competitors support the proposed position.
Educational estimate, not advice. See all assumptions & limitations →
Related reading
Guides to interpret the decision and its assumptions.
- Small-Business Pricing: A Decision Framework
Build a price from costs and contribution, then test margin, volume, capacity and customer-value assumptions in a clear decision sequence.
Read guide - How to Choose a Target Margin Without Guessing a Benchmark
Build a target-margin assumption from your own cost base, operating constraints and decision boundaries instead of copying a generic benchmark.
Read guide - Markup vs Margin: The Denominator Changes the Price
Understand why markup is measured against cost while margin is measured against selling price, and reconcile both directions.
Read guide - How to Build a Minimum Price Floor
Combine direct cost, an explicit shared-cost allocation and a minimum contribution assumption without mistaking the result for a market price.
Read guide - A Practical Small-Business Pricing Review Checklist
Review costs, margin assumptions, discounts, volume thresholds and product mix in a repeatable sequence with explicit stop points.
Read guide - Cost-Plus vs Value-Based Pricing for a Small Business
Compare the evidence, trade-offs and failure modes of cost-plus and value-based pricing without treating either method as a universal winner.
Read guide - Competitor-Based Pricing Risks for Small Businesses
Use competitor prices as observations, then test your own cost, capacity, offer, segment and tax boundary before choosing a price scenario.
Read guide - How to Write Pricing Assumptions Before Using a Calculator
Record the decision, boundaries, units, period, tax basis and stop conditions before entering pricing inputs.
Read guide - How to Compare Subscription, One-Off and Bundle Pricing
Compare the same customer job, horizon, recurring costs, cash timing and contribution without assuming any pricing model is universally best.
Read guide - Price Anchoring Tests and Small-Business Margin
Test a truthful anchor against a control while measuring contribution, conversion and guardrails without claiming a guaranteed uplift.
Read guide - How to Price a New Product When Cost Is Uncertain
Build reasoned low, base and high cost cases on one basis, then make a provisional pricing decision with explicit stop triggers.
Read guide
Frequently asked questions
How do I set a price for a target gross margin?
Compare the target with your current selling price and document the cost, value or positioning reason for any increase.
Which planning assumptions should I stress-test?
Compare a plausible alternative scenario and verify the decision-critical assumption that changes the plan most.