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Price change calculator

Nobody can tell you whether customers will leave. What can be worked out exactly is how many would have to, before the change stopped being worth making, and for a discount, how many more you would need just to stand still.

Your numbers

Per unit, per seat, per month: whatever you sell one of.
What is left after the direct cost of delivering it.
Negative for a discount. A cut of 10 is entered as -10.
Optional. It turns the percentage into a number of customers.

What it can cost you

—

Add a price, a margin and a change

What gets asked about this decision

None of these ask how much volume you can afford to lose, because that is already on the screen. They ask the things the arithmetic cannot: who leaves, who is told, and whether the price can ever come back.

  1. Does this apply to existing customers, or only to new ones?

    The most commonly skipped decision, and it changes the arithmetic completely: a new-customers-only change earns nothing from the base you already have, and takes far longer to show up. It also decides whether anybody has to be told at all.

  2. Who is told, how far ahead, and by whom?

    A price change discovered on an invoice is a different event from one announced with notice, even when the number is identical. Most of the churn a rise produces comes from how it arrived rather than from what it was.

  3. Which customers are on terms that fix the old price, and until when?

    Annual contracts, grandfathered rates and anything with a price-protection clause simply will not move. They are usually the largest accounts, which means the revenue this change actually touches is smaller than the whole book.

  4. If it does not land, how do you undo it?

    Price moves are not symmetrical. Coming down is easy and reads as a concession; going back up after a cut reads as a betrayal and usually costs more customers than the original rise would have.

Why a discount costs so much more than it looks

The instinct is that a 10% discount costs 10%. It does not, because the discount comes out of margin rather than out of price. Sell at 100 with a 30% margin and each sale contributes 30. Discount to 90 and it contributes 20: a third of your profit on the sale, gone, for a tenth off the price.

To earn back what you had, you need half again as many customers. Not ten percent more. Fifty. That is the number worth having before the decision rather than after it, and it is almost never calculated, because the discount is discussed as a percentage of price while it lands as a percentage of margin.

A rise works the same way, in your favour

The same arithmetic run backwards is why price rises are usually under-attempted. At a 30% margin, raising 10% takes contribution from 30 to 40, so you could lose a quarter of your customers and be exactly where you started. Most businesses would not lose anything like a quarter, which means the rise is worth more than it feels and the fear of it is larger than the exposure.

Thin margins amplify both directions

This is the part that catches people out. At a 10% margin, a 10% price rise doubles contribution, so it survives losing half the customers. The same business discounting 10% goes to zero contribution and no amount of volume rescues it. Low margin does not mean small effects; it means the price is doing nearly all the work, and every move on it is enormous.

What this does not do

It does not predict whether anybody will leave. That is elasticity, it needs your own data and your own market, and a page pretending to know it would be inventing the most important input. What is on the screen is a threshold: the point at which the change stops being worth it. Whether you cross it is a question about your customers, not about arithmetic.

It also holds unit cost still, which is right for a price change and wrong for anything that changes what you deliver. If the new price comes with a different product, the cost moves too and this understates the effect.

Terms on this page

Contribution
What one sale leaves you after the direct cost of delivering it. Price minus unit cost.
Gross margin
Contribution as a percentage of price. A 100 sale at 30% margin contributes 30.
Break-even volume change
The change in units sold that leaves total contribution exactly where it was.
Elasticity
How much demand actually moves when price does. Not modelled here: it is the thing this page deliberately refuses to guess.

A number is only as good as your answer about it.

Flintroom is a rehearsal room. A panel of AI interrogators presses on your argument out loud, quotes your own deck back at you, and does not accept the first answer. Then a coach rebuilds the ones that came loose.

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