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Selling Price Formula

This document is the implementation reference for the Business Calculator > Selling Price subpage in the Kesles Merchant app.

Active implementation reference:

  • business_price_calculator_page.dart

Input​

The calculator currently uses two main inputs:

  • Cost
  • Profit Target

Important notes:

  • Profit Target in the current implementation is interpreted as markup over cost
  • Profit Target is not the final margin

Main Formulas​

1. Ideal selling price​

harga_jual_ideal = ceil(modal x (1 + target_keuntungan / 100))

Example:

modal = 100.000
target_keuntungan = 25%

harga_jual_ideal = 100.000 x (1 + 25/100)
                  = 100.000 x 1,25
                  = 125.000

2. Profit per unit​

profit_per_unit = harga_jual_ideal - modal

3. Gross margin​

margin_kotor = (profit_per_unit / harga_jual_ideal) x 100

Notes:

  • if harga_jual_ideal <= 0, gross margin is forced to 0

4. Actual markup​

markup_aktual = (profit_per_unit / modal) x 100

Notes:

  • if modal <= 0, actual markup is forced to 0
  • in the current implementation, actual markup will equal profit target as long as the input is valid

Insight Criteria​

The badge and bottom summary use the computed gross margin.

Initial validation​

  • if modal <= 0

    • badge: Fill Cost
    • title: Enter cost per unit first

  • if target_keuntungan <= 0

    • badge: No Profit
    • title: Current selling price has not produced profit

Margin levels​

  • if margin < 5%

    • badge: Very Thin
    • title: Profit target is too low

  • if margin >= 5% and < 12%

    • badge: Thin
    • title: Profit target is still thin

  • if margin >= 12% and < 20%

    • badge: Sufficient
    • title: Selling price begins to allow room for profit

  • if margin >= 20% and <= 35%

    • badge: Healthy
    • title: Recommended selling price looks healthy

  • if margin > 35% and <= 50%

    • badge: Optimal
    • title: Recommended selling price is ready to use

  • if margin > 50% and <= 65%

    • badge: Aggressive
    • title: Profit target is fairly aggressive

  • if margin > 65% and <= 80%

    • badge: High
    • title: Selling price needs market testing

  • if margin > 80% and <= 90%

    • badge: Very High
    • title: Profit target is very high

  • if margin > 90%

    • badge: Extreme
    • title: Selling price risks being too high

Calculation Examples​

Assumptions:

  • Cost = Rp 100,000

Profit target 1%​

harga_jual_ideal = 101.000
profit_per_unit = 1.000
margin_kotor = 0,99%
markup_aktual = 1%

Insight:

  • badge: Very Thin

Profit target 10%​

harga_jual_ideal = 110.000
profit_per_unit = 10.000
margin_kotor = 9,09%
markup_aktual = 10%

Insight:

  • badge: Thin

Profit target 25%​

harga_jual_ideal = 125.000
profit_per_unit = 25.000
margin_kotor = 20,00%
markup_aktual = 25%

Insight:

  • badge: Healthy

Profit target 30%​

harga_jual_ideal = 130.000
profit_per_unit = 30.000
margin_kotor = 23,08%
markup_aktual = 30%

Insight:

  • badge: Healthy

Profit target 50%​

harga_jual_ideal = 150.000
profit_per_unit = 50.000
margin_kotor = 33,33%
markup_aktual = 50%

Insight:

  • badge: Healthy

Profit target 100%​

harga_jual_ideal = 200.000
profit_per_unit = 100.000
margin_kotor = 50,00%
markup_aktual = 100%

Insight:

  • badge: Optimal

Profit target 200%​

harga_jual_ideal = 300.000
profit_per_unit = 200.000
margin_kotor = 66,67%
markup_aktual = 200%

Insight:

  • badge: High

Profit target 1000%​

harga_jual_ideal = 1.100.000
profit_per_unit = 1.000.000
margin_kotor = 90,91%
markup_aktual = 1000%

Insight:

  • badge: Extreme

Important Notes on Markup vs Margin​

Many users assume that profit target 25% means final margin 25%.

In this calculator, what is actually used is:

target keuntungan = markup

So:

  • markup 25% produces margin 20%
  • markup 50% produces margin 33,33%
  • markup 100% produces margin 50%

In summary:

  • markup is computed against cost
  • margin is computed against selling price

Limitations of the Current Version​

This calculation does not yet include other factors such as:

  • tax
  • MDR
  • discount
  • operational cost
  • labor cost
  • daily service fee
  • returns or damaged goods

Therefore, the Ideal Selling Price result is still a minimum selling price based on cost and target markup, not the final operational price.

If the calculator is to become more realistic, the next version should add:

  • operational cost per unit
  • MDR deduction
  • average discount
  • monthly fixed cost
  • target net profit

This way, users can choose:

  • selling price based on markup
  • selling price based on margin
  • selling price based on net profit