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BREAK-EVEN ELASTICITY
For average-margin SKUs, which is more likely to grow profit?
Break-evens differ by variable margin:
Decrease Price?
If drop price by 4%,
sales must increase more than 15% to grow profit.
Break-even elasticity of -3.75 (i.e., 15/-4)
B2B: Highly unlikely
B2C: Possible, but rare
Change in Price
Break-even change in sales
Increase Price?
If raise price by 4%, sales must decline less than 12% to grow profit.
Break-even elasticity of -3.0 (i.e., -12/4)
B2B: Very likely
B2C: Likely
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