Finance Tools
Supplier Cost Pass-Through Impact Calculator
Estimate margin and profit impact when supplier costs rise and you pass through part of the increase to customers via price changes.
Model how supplier cost increases impact your unit margin when you pass through part of the shock to customers via price changes.
Your current price per unit.
Your current cost per unit before the supplier change.
How much your supplier raises costs.
0% = you absorb all. 100% = you recover the full cost increase. >100% = over-pass-through.
Used to estimate total profit impact.
Cost increase per unit: $3.00 · Pass-through per unit: $1.80
Before
Price: $50.00
Cost: $30.00
Margin: $20.00 (40.00%)
After
New price: $51.80
New cost: $33.00
Margin: $18.80 (36.29%)
Impact
Margin change per unit: -$1.20
Total profit change: -$12,000
Margin compresses. You’re absorbing part of the shock.
How it works
- New cost = old cost × (1 + supplier increase%).
- Cost increase/unit = new cost − old cost.
- Pass-through amount = cost increase × pass-through rate.
- New price = old price + pass-through amount.
- New margin = new price − new cost.
FAQ
Can pass-through exceed 100%?
Yes. Some businesses raise prices more than the cost shock (over-pass-through), but demand may drop.
Does this model demand changes?
No. It assumes units sold stay constant. Combine with elasticity tools if you want volume effects.
How to use this supplier cost pass-through impact calculator
- Enter current selling price and unit cost.
- Enter supplier cost increase (%).
- Enter pass-through rate (%) — how much of the increase you raise prices by.
- Review new unit cost, new price, margin, and profit impact.
Example
Price is $50/unit, cost is $30/unit. Supplier increases cost by 10%. You pass through 60% of the increase.
- New cost = 30 × 1.10 = 33.00
- Cost increase = 3.00
- Pass-through amount = 3.00 × 0.60 = 1.80
- New price = 50 + 1.80 = 51.80
- New margin = 51.80 − 33.00 = 18.80
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- Price Increase Needed to Maintain Margin Calculator
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