Pricing Calculator

Start with cost-plus pricing as your floor (all costs plus a 40-60% margin minimum), research competitor pricing for market context, then test value-based pricing anchored on the economic value you deliver. A 1% improvement in pricing increases operating profit by 11.1% according to McKinsey research, making pricing the highest-leverage financial lever.

Value-based pricing outperforms cost-plus: companies using it grow 2x faster per ProfitWell data. For SaaS, tier-based pricing with 3 plans (good-better-best) converts 25% better than a single price point. Test prices by observing that a healthy 20-30% of prospects push back on price. Less pushback suggests underpricing.

Value-based pricing is the most effective SaaS strategy according to ProfitWell data, companies using it grow 2x faster than cost-plus pricers. Charge based on the value your product delivers, not your costs. Most SaaS products are underpriced by 20-40%.

Start with cost-plus pricing as a floor (costs + 40-60% margin minimum), then research competitor pricing for context, and finally test value-based pricing. Small businesses that raise prices by 10% lose less than 5% of customers on average, resulting in net revenue increase.

Test the calculator's recommended price in live sales conversations. If fewer than 20% of prospects push back on price, the recommendation is too cheap. If more than 50% reject on price, it is too expensive. The sweet spot is 20-30% price pushback. Adjust the calculator inputs and re-run quarterly.

Review pricing every 6-12 months and raise prices at least annually. SaaS companies that have not raised prices in over a year are leaving significant revenue on the table. Price increases of 5-10% are typically accepted without significant churn.

Value-based pricing sets prices according to the perceived value to the customer rather than cost of delivery. It matters because it captures more of the value you create, a tool that saves a customer $100K/year can charge $10K/year and still deliver 10x ROI.

Break even is the point where total revenue exactly equals total costs, producing zero profit or loss.

Every high-converting SaaS pricing page needs three tiers with the recommended plan highlighted, an annual vs monthly pricing toggle, a feature comparison table, social proof such as logos or testimonials, an FAQ addressing the top 3 objections, and a clear CTA on each tier.

Three tiers is optimal for most SaaS pricing pages.

Build custom software only when it provides a genuine competitive advantage that cannot be replicated by off-the-shelf tools, when your requirements are so unique that existing solutions cover less than 50% of your needs, or when regulatory or security requirements mandate full control.

Failed payments break down as: expired or replaced cards (40% of failures), insufficient funds (30%), bank-side declines such as fraud flags or international restrictions (20%), and technical errors (10%) according to Recurly data.