Your Results
Distributor Price Per Unit
—
The price the distributor sells your product for to the retailer.
Broker Commission Per Unit
—
The dollar amount paid to the broker for each unit sold.
Net Selling Price Per Unit
—
The final amount your brand receives per unit after all channel margins, commissions, and costs.
Total Channel Margin (%)
—
The cumulative percentage margin taken by all intermediaries from MSRP to your net selling price.
How This Calculator Works
This calculator takes your suggested retail price and works backward through each margin layer, including retailer, distributor, and broker fees. It determines the net price your brand receives after all deductions. The tool helps identify the impact of different margin structures on your profitability.
When to Use This Tool
A CPG brand is launching a new snack product and needs to set competitive pricing while ensuring profitability across retail channels.
The tool helps model different margin structures to find a sustainable net selling price that supports brand growth and covers operational costs.
An established beverage brand wants to assess the profitability of selling through a new regional distributor versus their current national network.
By inputting specific margin agreements, the brand can compare net selling prices and identify which distribution channel offers better financial returns per unit.
A frozen food brand is considering partnering with a new broker and needs to understand the impact of their proposed commission structure on the brand's bottom line.
The calculator quantifies the exact per-unit cost of the broker's commission, allowing for informed negotiation and clear understanding of the net revenue.
Common Questions
How does this tool handle variable trade spend or promotional allowances?
The tool includes an input for trade spend as a percentage, allowing you to factor in promotional allowances or marketing contributions that reduce your net selling price.
Can I use this for different product sizes or SKUs?
Yes, input the per-unit values for each specific SKU or product size. The calculations are based on individual unit economics, making it versatile for your entire product line.
What if my brand does not use a broker?
If you don't work with a broker, simply enter '0' for the broker commission percentage. The tool will then calculate your net selling price based solely on retailer and distributor margins.
Does this calculator account for my Cost of Goods Sold (COGS)?
While this tool primarily focuses on calculating your net selling price after channel margins, it does not directly incorporate your Cost of Goods Sold (COGS). You would compare the calculated net selling price against your COGS separately to determine gross profit per unit.
Optimize Your CPG Pricing for Profitability
Guidance provides CPG brands with actionable insights and tools to master their financial operations. Make data-driven decisions to improve your margins and grow your business.
Apply for Early Access