Calculate and Simulate Product and Service Prices in Excel with Three Professional Methods
Setting the right selling price is one of the most critical decisions in any business.
Price too low, and you lose profitability. Price too high, and you lose sales.
The 3 Methods Selling Price Calculation Free Excel Template gives you a professional, structured way to calculate and analyze your optimal sales prices, using three practical methods that balance cost, margin, and market demand.
The Importance of a Strategic Pricing Model
Determining a product’s price isn’t just a marketing decision — it’s a financial and strategic challenge.
While the market sets general expectations, your company must ensure that every price:
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Covers direct and indirect costs
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Generates enough gross margin to exceed general expenses
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Provides a sustainable profit
This is the foundation of profitability analysis and break-even control.
The key is to obtain a Total Gross Margin = Unit Margin × Units Sold,
capable of covering structural costs and generating benefits — the essence of any multi-product break-even model.
The 3 Pricing Methods Included in the Excel Template
This free Excel template lets you compare and simulate three approaches to selling price calculation, depending on your business model and market conditions.
1️⃣ Market-Based Pricing (External Reference Method)
In this scenario, prices are determined by the market.
Your challenge as a company is to adapt your costs to ensure profitability within those price limits.
You’ll need to monitor:
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Unit costs
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Overhead expenses
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Break-even point and margin
✅ Ideal for: highly competitive industries where prices are driven by demand or competition.
2️⃣ Cost-Plus Pricing (Markup on Cost Method)
This is the classic method: you calculate the selling price by applying a percentage increase over your unit cost.
Example:
If your product costs €1 and you apply a 50% markup on cost, the sale price will be €1.50.
However, the real margin (profit vs. selling price) will only be 33.3%, not 50%.
This highlights the importance of understanding the difference between markup on cost and margin on price.
✅ Ideal for: simple cost structures or when margins are flexible.
3️⃣ Margin-Based Pricing (Target Margin Method)
In this method, you apply the desired profit margin directly, ensuring that the resulting percentage truly reflects your target profitability.
Example:
If you want a 50% profit margin, this method calculates a selling price that guarantees that exact 50% margin, not just a markup.
✅ Ideal for: financial planning, profitability simulations, and budget forecasting.
Integrated Profitability Analysis
In all three methods, the template automatically calculates:
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Unit cost and unit margin
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Total margin = Unit margin × Expected units sold
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Deduction of general or structural expenses to estimate net profitability
This allows you to perform simulations and “what-if” scenarios to evaluate:
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Pricing strategy impact
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Profitability under different demand levels
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Sensitivity to cost or price changes
How to Use the Excel Template
1️⃣ Input your products or services and their unit costs.
2️⃣ Define the desired pricing method (market, cost-plus, or margin).
3️⃣ Enter the expected sales volume and general expenses.
4️⃣ Review the calculated total gross margin and expected profit.
5️⃣ Adjust variables to simulate different market or cost conditions.
You’ll be able to compare results instantly and make better-informed pricing decisions.
Why Use the 3 Methods Selling Price Excel Template
✅ 100% Free, editable, and professional
✅ Compare three pricing strategies side by side
✅ Calculate unit and total margins automatically
✅ Simulate different sales volumes and cost scenarios
✅ Identify breakeven and profitability points
✅ Ideal for controllers, financial managers, and entrepreneurs
This is a must-have tool for pricing optimization, margin analysis, and business decision-making.
Download the 3 Methods Selling Price Calculation Free Excel Template
Stop guessing your prices — start calculating them strategically.
Download the Free Excel Template with 3 Pricing Methods, analyze your margins, and ensure your prices lead to profitability.
👉 Get it now
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