Supplier cost increases for retailers: setting new shelf prices
A retailer sets one shelf price per item, usually on a fixed ending like .99, against a target margin. When a supplier raises cost, every affected item needs a new price that clears the target after rounding, not before.
The method
- List every item whose cost changed, with old and new cost and the current retail price. The free price list compare tool gives you that from the old and new supplier files.
- Margin at the current retail on the new cost tells you how far each item has slipped.
- Price for the target margin = new cost / (1 - target margin).
- Round up to your ending. Rounding up can only raise the margin, so the rounded price always clears the target.
- Check the result against any price the item must not exceed: a printed price on the pack, a competitor you match, or a price point your customers expect.
New cost in C2, target margin in $H$1 (45%), rounded up to .99:
=CEILING(C2/(1-$H$1)+0.01,1)-0.01The margin you end up with, retail in D2:
=(D2-C2)/D2Worked example: four garden lines, 45% target margin
| Item | Cost | Retail now | Margin before | Margin now | Price for 45% | New retail (.99) | Margin at new retail |
|---|---|---|---|---|---|---|---|
| Garden hose 50ft | $14.20 to $15.30 | $24.99 | 43.2% | 38.8% | $27.82 | $27.99 | 45.3% |
| Hose nozzle, 7 pattern | $4.10 to $4.40 | $7.99 | 48.7% | 44.9% | $8.00 | $8.99 | 51.1% |
| Pruning shears | $9.60 to $10.75 | $17.99 | 46.6% | 40.2% | $19.55 | $19.99 | 46.2% |
| Potting mix 1 cu ft | $5.30 to $5.85 | $9.49 | 44.2% | 38.4% | $10.64 | $10.99 | 46.8% |
Hold every current price and the weakest line drops to 38.4%. After repricing every line is back above 45%. The hose nozzle, 7 pattern shows the cost of a fixed ending: the 45% price is $8.00, just above $7.99, so the rounded price jumps to $8.99. Holding $7.99 instead leaves 44.9%, just under target. That is a judgement call, not arithmetic. If the new price crosses a price point you care about, the margin impact calculator shows what holding the old price costs you instead.
Repricing a whole category by the same percentage? The bulk increase tool applies it to a pasted list with .99 rounding.
Pricecheck takes the supplier's email as it arrives, PDF included, compares it with the last version and sends back only the lines that moved. $49/mo, first month free for early signups. No payment now.