Pricing calculator

Set a price that delivers your target gross margin, and see the GST-inclusive price your customer pays.

What you enter

  • Cost per unit (ex GST) – Everything it costs to deliver one unit: materials, direct labour, packaging, freight, merchant fees.
  • Target gross margin – The share of the selling price (ex GST) you want to keep as gross profit. Must be below 100%.
  • GST rate – GST is 10% on most taxable sales. Use 0 if you are not registered or the item is GST-free.

How it is calculated

Price ex GST = Cost ÷ (1 − Target margin). GST = Price ex GST × GST rate. Price inc GST = Price ex GST + GST. Markup = (Price ex GST − Cost) ÷ Cost.

Assumptions

  • Margin is calculated on the price excluding GST.
  • Cost per unit includes every direct cost of the sale.
  • GST applies at a single rate to the whole price.

Limitations

  • Cost-plus pricing ignores what customers will pay and what competitors charge; use it as a floor, then test value-based prices.
  • Discounts come straight out of margin; check the result after any discount you plan to offer.

Related articles

  • Pricing and profit margins – The difference between markup and margin, three ways to set prices, how break-even works, and why a small price increase does more for profit than a large increase in sales.
  • GST, BAS and taxation fundamentals – How GST works, what a Business Activity Statement actually reports, how PAYG withholding and instalments fit in, and the habits that make the ATO a routine supplier rather than a source of dread.
  • Understanding profitability – Revenue is not profit. The difference between gross, operating and net profit, how margins and break-even work, why profitable businesses still run out of cash, and the levers that lift profit.