How PPS Calculates Pricing (v1.3.0)
Understand how PPS builds true per-unit cost, applies Sales Outlet assumptions, and calculates a recommended base price that protects margins after fees — with break-even clarity built in.
PPS is not “materials × 2.” It’s structured pricing math.
Product Pricing Studio calculates true per-unit cost, applies channel assumptions, and solves for a target margin so you know what price is required to be profitable — not just what “feels right.”
True variable cost
PPS builds your per-unit cost from materials, labor, machine time, packaging, and other variable expenses. This is your real “cost to produce one unit.”
Channel-aware pricing
In v1.3.0, Sales Outlets let you price the same product differently for Website vs Etsy vs Wholesale using defaults for fees, packaging, and target margin.
Break-even clarity
PPS shows contribution margin and break-even units so your pricing supports fixed costs and profit goals, not just the next sale.
How PPS calculates your recommended price
PPS follows a repeatable process. The numbers you enter flow through the same model every time, so your pricing stays consistent.
1) Build variable cost per unit
- Materials (linked from Raw Materials)
- Labor ($ per unit)
- Machine time × cost per minute
- Packaging ($)
- Other variable materials & consumables
2) Apply Sales Outlet assumptions (v1.3.0)
- Marketplace fee (%)
- Payment processing (%) + flat fee
- Additional % and flat fees
- Discount % (optional)
- Shipping strategy (where fees apply)
- Default packaging and target margin
3) Solve for target margin
PPS uses margin math (not markup) to calculate the price required to hit your Target Profit Margin after variable costs and fees.
Result: a recommended base price that matches your business goals.
Where you’ll see these numbers
The Product Pricing page shows the totals and the “why” behind them so you can make confident decisions.
Total Variable Cost / Unit
Your combined per-unit costs (materials, labor, machine, packaging, other) plus outlet fees when enabled.
Contribution Margin
How much money is left per unit after variable costs — the portion that pays fixed costs and profit.
Break-even & target units
PPS calculates break-even units per month and units required for your profit goal using your contribution margin.
Price the same product correctly in different channels
Create Sales Outlets for your real selling channels. Then switch outlets on the pricing page to compare fees, margins, recommended price, and break-even instantly.