Act on the result
Confirm that each tier threshold directs customers toward the intended commercial behaviour.
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
Owners designing two volume tiers without losing sight of weighted economics.
Outputs
Tier revenue, weighted price, contribution margin and operating profit.
Start here
Enter the exact price and expected quantity in each tier for the same period.
Use a different tool when: Do not use this to test a product bundle; use Product Bundle Pricing & Profit Planner for that decision. Use this tool to design volume tiers.
Price & margin
Tiered Pricing Profit: tier revenue
Tier revenue, weighted price, contribution margin and operating profit.
Amounts use the same currency as your inputs. No currency conversion is performed.
Tiered Pricing Profit
Reconcile revenue and profit across two price tiers.
Your numbers stay in this browser
Price in the first tier.
Units in the first tier.
Price in the second tier.
Units in the second tier.
Cost per unit across tiers.
Period fixed costs.
Decision result
Every result is derived by the registered pricing engine.
PDF and CSV exports stay on this device. Clean page links contain no inputs.
- Operating profit
- 7,500.00
- Revenue Ex Tax
- 31,250.00
- Contribution Ex Tax
- 15,500.00
- Weighted Average Price Ex Tax
- 89.29
- Contribution Margin
- 49.6%
Scenario comparison
Each row names the assumption axis changed from the baseline.
ScenarioResultDifference
Current scenario7,500.00Baseline
Lower Tier two price6,437.50-1,062.50
Higher Tier two price8,562.501,062.50
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.
Operating profit
Operating Profit Ex Tax
total tier contribution − fixed costs7,500 , ex taxResult7,500.00
Uses the entered assumptions on one consistent ex-tax commercial basis. The engine retains full precision; presentation is bounded for readability.
Tiered Pricing Profit Planner formulas →Inputs used by these formula steps
- Operating Profit Ex TaxTier One Price Ex Tax
- 100
- Operating Profit Ex TaxTier One Units
- 100
- Operating Profit Ex TaxTier Two Price Ex Tax
- 85
- Operating Profit Ex TaxTier Two Units
- 250
- Operating Profit Ex TaxUnit Variable Cost Ex Tax
- 45
- Operating Profit Ex TaxFixed Costs Ex Tax
- 8,000
Revenue Ex Tax
Revenue Ex Tax
tier one price × units + tier two price × units31,250 , ex taxResult31,250.00
Uses the entered assumptions on one consistent ex-tax commercial basis. The engine retains full precision; presentation is bounded for readability.
Tiered Pricing Profit Planner formulas →Inputs used by these formula steps
- Revenue Ex TaxTier One Price Ex Tax
- 100
- Revenue Ex TaxTier One Units
- 100
- Revenue Ex TaxTier Two Price Ex Tax
- 85
- Revenue Ex TaxTier Two Units
- 250
- Revenue Ex TaxUnit Variable Cost Ex Tax
- 45
- Revenue Ex TaxFixed Costs Ex Tax
- 8,000
Contribution Ex Tax
Contribution Ex Tax
tier revenue − unit variable cost × total units15,500 , ex taxResult15,500.00
Uses the entered assumptions on one consistent ex-tax commercial basis. The engine retains full precision; presentation is bounded for readability.
Tiered Pricing Profit Planner formulas →Inputs used by these formula steps
- Contribution Ex TaxTier One Price Ex Tax
- 100
- Contribution Ex TaxTier One Units
- 100
- Contribution Ex TaxTier Two Price Ex Tax
- 85
- Contribution Ex TaxTier Two Units
- 250
- Contribution Ex TaxUnit Variable Cost Ex Tax
- 45
- Contribution Ex TaxFixed Costs Ex Tax
- 8,000
Weighted Average Price Ex Tax
Weighted Average Price Ex Tax
tier revenue ÷ total units89.29 , ex taxResult89.29
Uses the entered assumptions on one consistent ex-tax commercial basis. The engine retains full precision; presentation is bounded for readability.
Tiered Pricing Profit Planner formulas →Inputs used by these formula steps
- Weighted Average Price Ex TaxTier One Price Ex Tax
- 100
- Weighted Average Price Ex TaxTier One Units
- 100
- Weighted Average Price Ex TaxTier Two Price Ex Tax
- 85
- Weighted Average Price Ex TaxTier Two Units
- 250
- Weighted Average Price Ex TaxUnit Variable Cost Ex Tax
- 45
- Weighted Average Price Ex TaxFixed Costs Ex Tax
- 8,000
Contribution Margin
Contribution Margin
tier contribution ÷ tier revenue49.6%Result49.6%
Uses the entered assumptions on one consistent ex-tax commercial basis. The engine retains full precision; presentation is bounded for readability.
Tiered Pricing Profit Planner formulas →Inputs used by these formula steps
- Contribution MarginTier One Price Ex Tax
- 100
- Contribution MarginTier One Units
- 100
- Contribution MarginTier Two Price Ex Tax
- 85
- Contribution MarginTier Two Units
- 250
- Contribution MarginUnit Variable Cost Ex Tax
- 45
- Contribution MarginFixed Costs Ex Tax
- 8,000
Inputs used
- Tier one price
- 100
- Tier one units
- 100
- Tier two price
- 85
- Tier two units
- 250
- Variable cost per unit
- 45
- Fixed costs
- 8,000
Open 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 |
|---|---|---|---|---|---|
| fixedCostsExTax | Period fixed costs. | currency units/comparison period, ex tax | 0 to 10000000 | Required | 8000 |
| tierOnePriceExTax | Price in the first tier. | currency units/tier one unit, ex tax | 0 to 10000000 | Required | 100 |
| tierOneUnits | Units in the first tier. | whole tier one units/comparison period | 0 to 10000000 | Required | 100 |
| tierTwoPriceExTax | Price in the second tier. | currency units/tier two unit, ex tax | 0 to 10000000 | Required | 85 |
| tierTwoUnits | Units in the second tier. | whole tier two units/comparison period | 0 to 10000000 | Required | 250 |
| unitVariableCostExTax | Cost per unit across tiers. | currency units/product unit, ex tax | 0 to 10000000 | Required | 45 |
Tiered Pricing Profit: tier revenue
Weighted price and operating profit show the combined economics of both expected pricing tiers.
Formula summary
- Primary formula
- operating profit = tier revenue − variable costs − fixed costs
Data used here
- The estimate uses your inputs and the general business formula documented in the methodology.
Decision checks
Stress-test the decision
Move expected units between tiers to test discount leakage near the threshold.
When this estimate can be misleading
- Results depend on the accuracy and consistent basis of your inputs.
- The planner does not predict demand, competitor behaviour or supplier terms.
- Use the result as educational business decision support, not accounting, tax or legal advice.
- Weighted price and operating profit show the combined economics of both expected pricing tiers.
Educational estimate, not advice. See all assumptions & limitations →
Related reading
Guides to interpret the decision and its assumptions.
- Good-Better-Best Packages: Test the Margin Mix
Reconcile each package, test the assumed customer mix and define rollout checkpoints without treating the mix as a demand forecast.
Read guide
Frequently asked questions
How do I design volume tiers?
Confirm that each tier threshold directs customers toward the intended commercial behaviour.
Which planning assumptions should I stress-test?
Compare a plausible alternative scenario and verify the decision-critical assumption that changes the plan most.