So I don't know if my title accurately described my needs, but here goes;
I sell items online. I need to figure out what I should set the Retail price at to come to a specific margin %.
Image of the Sheet I am using
In this example, I want to hit 20% margin. What formula (Excel) can I use to help me determine that? Keep in mind that the 'Amazon 15%' and the 'Returns 5%' will change when the Retail changes - therein lies my challenge.
This is more a mathematical question instead of an excel question.
But the answer is:
=(B2+E2)/(1-(0.15+0.05+0.2))
We divide the total of cost by 1 - the sum of the various percentages.
x = COGS + Shipping + 0.15x + 0.05x + 0.20x
x = COGS + Shipping + 0.40x
x - 0.40x = COGS + Shipping
0.60x = COGS + Shipping
x = (COGS + Shipping)/0.60
Related
Hi all,
I have something that I cannot explain.
Here is an explanation of the table
Weight
Price Increase in %
Old Price
New Price = ( Old Price * Price Increase ) + Old Price
Total Old Price = Old Price * Weight
Total New Price = New Price * Weight
When using SumProduct to calculate the weighted average I get
=SUMPRODUCT(A2:A6,B2:B6)/SUM(A2:A6) = 16.1072%
But a Finance guy told me that was wrong that I needed to calculate it like this
=SUM(F2:F6)/SUM(E2:E6)-1 = 16.2465%
1 - Why is it giving different results
2 - Who is right
Anyone able to shed some light on this would be greatly appreciated !
I am trying to find a formula that will generate the total profit for a number of cohorts that generate a different periodic profit per unit, without having to create a line item for each cohort.
In this example, the profit contributed by each widget over time is shown in row 3, and the number of widgets issued in each cohort is shown vertically in column B. Each unit will contribute $25 in the first period, $60 in the second period, and so on. So year 1 total profit would be 100 x $25 = $2,500. Then in year 2, the Y1 cohort would generate 100 x $60 and the Y2 cohort would generate 200 x $25 for a total year 2 profit of $11,000.
Does someone know of a method in Excel that would work to consolidate the total profit calculation each year into a single formula? I am trying to model multiple line items over many periods, so looking for a more efficient solution.
Edit: In case this helps clarify the question, below is an image showing an example of another inefficient way to solve the problem in one line for year 4 total profits, but this is still not scalable. Also shown in text below.
`Year 4 total profit =
Y1 units issued x P4 profit per unit +
Y2 units issued x P3 profit per unit +
Y3 units issued x P2 profit per unit +
Y4 units issued x P1 profit per unit`
inefficient solution
Office 365, in C17:
=SUM(INDEX($B7:$B15,SEQUENCE(COUNT($C3:C3)))*INDEX($C3:C3,SEQUENCE(COUNT($C3:C3),,COUNT($C3:C3),-1)))
and copied right.
Ah well, I've just written an answer compatible with lower versions of Excel:
=MMULT(TRANSPOSE(B7:B15)^0,IF(ROW(B7:B15)-ROW(B7)<=COLUMN(C3:K3)-COLUMN(C3),INDEX(C3:K3,COLUMN(C3:K3)-COLUMN(C3)-(ROW(B7:B15)-ROW(B7))+1)*B7:B15,0))
It could be done a bit more easily in Excel 365 using Sequence() instead of row() and column(), but the same principle - generate a 2D matrix by comparing row and column numbers, then obtain its column totals using a standard method with Mmult.
I've filled in the intermediate results in C7:K15, but you only need the formula in C17.
So I am working on a spreadsheet for a Butchery I manage and have run into a problem.
First off back story: We do $20 packs for certain bulk products that have a min/max weight range.
The Goal is to be able to put in this spreadsheet the desired minimum GP% and from that get a maximum weight based off that minimum profit margin.
For example a Beef Steak that Costs $17.50 p/kilo Would be minimum of 680g (at a GP% of 30.30%) and a maximum weight of 790g (at a GP% of 20.50%)
I have been 'googling' all day, and banging my head on my desk (as well as experimenting with different formula's) I am starting to think I may have to resort to programming a macro to perform this but I would prefer to be able to achieve in a formula on the cell that way I can copy-paste easily down the spreadsheet.
If anyone has a solution or can put me on the right track would be Awesome.
I think the formula you are looking for is :
your selling price (=20$) / your mark up on cost
where your mark up is :
your cost per kilo / (1- your margin)
So for 20% expected GP it gives :
= 20 / (17.5 / (1-0.2))
= 20 / 21.875
= 0.914... kilos
Balance is then :
Revenue = 20$
Cost = 0.914 * 17.5 = 16
Margin = 4
Margin % = 20
My end goal is to distribute items into different discounts for sales. For example I may have 1000 items in an up-to 20% off sale. I am trying to come up with a way to cluster more items towards a discount, say 15%. So the discount distribution is a curve, with the peak number of items around 15% and less items at the extreme low and high discounts.
I want this to work for many different sales- number of items included will change and the discount ranges will change. I may have 25,000 items in a 10-40% off sale.
Variables:
L = Low Discount
H = High Discount
S = Discount Spread (H - L)
I = Item Count
D = Discount Sread (S / I)
C = ClusterPeak, where I want the most items
All items are ranked and sorted. Using Excel, Excel VBA or FileMaker I am sure there is math thing I can throw at this to make work.
Using the first example of 1000 items in an up-to 20% off sale. (starting at 1%)
L = .01
H = .2
S = .19
I = 1000
D = .00019
C = .15
R = Current Row or Record.
To get linear, evenly distributed discounts, I know I can do this-
(R * S) + L or (1 * .00019) + .1
This gets me .01019, .01038... The 1000th item gets .2, or 20%. This works regardless of the discounts and items count. Yay!
But I am stumped on how to cluster more items around a discount in a smooth curve. I have tried throwing LOG and standard deviation at the problem in various uses but obivously it didn't work or I wouldn't be here.
Sorry if this is miscategorized or poorly explained. It is very hard explaning what you don't know. Is there a better name or description for what I am trying to accomplish?
I need help creating an Excel function that will determine the optimal price-point for a product, given the required profit margin.
NET MARGIN = (PROFIT / PRICE) = 30%
PRICE = (COGS + Fixed Costs + Variable Costs)
COGS = $5.00
FIXED = $3.00
VARIABLE = (15% * PRICE)
The problem that I can't get my head around is that as the price goes up, the variable costs go up as well. So how do I automate the product pricing for a required margin of 30%?
Any help is appreciated.