Isolating the Impacts of Price, Volume, Cost and Mix
A Handy Tool for Understanding Where Changes in Revenues and Margins Are Really Coming From
As pricing professionals, we're under constant pressure to explain differences in period-over-period revenues and margin-dollars. Are the revenue increases you're seeing the result of selling more volume, realizing higher prices, or both? What portion of the margin gain you're experiencing is really coming from better prices and how much is actually coming from better costs? And how much of all of it can just be attributed to selling a different mix of products? Answer all of these questions and more with the Impact Isolation Estimator. Using this straightforward spreadsheet-based tool, you can:
- Isolate the impacts that volume, pricing, costs, and mix have had on period-over-period performance changes.
- Quantify how much volume, pricing, costs, and mix have contributed to differences in both revenues and margin dollars.
- Identify where changes in product costs have magnified...or mitigated...improvements in realized prices and volume.
- Put an end to the second guessing, skepticism, and in-fighting over who or what should be getting the credit (or blame).
This tool is just one of hundreds of educational resources you get access to as a PricingBrew Journal subscriber.
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