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How to calculate the impact of a price increase

Before you raise prices, or run a sale, work out the break-even: how many customers you can afford to lose, or how many more you'd need. It takes four numbers.

What you need

  • Your current price.
  • Your cost per sale (materials, direct labor, fees).
  • The size of the change, as a percentage.
  • Optional: customers or sales a month.

1. Find profit per sale now

A dog groomer charges $70. Shampoo, supplies, a helper’s time and the card fee come to $22. Profit per groom: $48.

2. Find profit per sale after the change

An 8% increase makes the price $75.60. Profit per groom becomes $75.60 − $22 = $53.60. All of the increase goes to profit, because costs didn’t change.

3. Work out how many sales you can lose

Sales you can lose = 1 − (profit now ÷ profit after). 1 − 48 ÷ 53.60 = 10.4%. With 120 grooms a month, she could lose 12 customers and earn the same; every customer she keeps beyond that is extra profit.

4. Run the same math on a discount

A 15% sale cuts the price to $59.50 and profit per groom to $37.50. Extra sales needed = (profit now ÷ profit after) − 1 = 48 ÷ 37.50 − 1 = 28% more grooms, just to stand still.

In a spreadsheet

B1: Price (70)
B2: Cost per sale (22)
B3: Change (8%)
B4: Can lose after a raise: =1-(B1-B2)/(B1*(1+B3)-B2)
B5: Need after a cut: =(B1-B2)/(B1*(1-B3)-B2)-1

Make the decision

Compare the number with what you know about your customers. If losing 10% seems unlikely, the increase is low risk. Give notice, explain it plainly, and watch cancellations for a month.

Published by Groundwork Business Advisory. Updated October 19, 2026.

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