MarginWorkshopPrice Increase Impact Simulator
Before you raise prices: how much client attrition would actually erase the gain, and how much profit is on the table if fewer clients leave than that.
How we got here
- New revenue = current revenue × (1 - attrition) × (1 + increase) = $513,000
- Break-even attrition = increase / (increase + margin) = 8.0% / (8.0% + 35.0%) = 18.6%
Profit change at other attrition levels
| Attrition scenario | Profit change | Verdict |
|---|---|---|
| No attrition (0%) | $40,000 | Net positive |
| Light (5%) | $29,250 | Net positive |
| Moderate (10%) | $18,500 | Net positive |
| Heavy (20%) | -$3,000 | Net negative |
| Severe (30%) | -$24,500 | Net negative |
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Next Decision
Based on your results, these related decisions are available.
Methodology
Formula: a price increase doesn't raise the cost of serving a retained client, so break-even attrition = price increase % / (price increase % + gross margin %). Losing a client removes both their revenue and the cost of serving them, only the retained clients' higher price is pure margin gain.
Assumption: gross margin is your average across all jobs, the same non-persisted assumption used in Overhead Allocation & Break-Even Revenue.
Limitation: assumes cost to serve scales only with client count, not with price, and treats attrition as an instant, one-time event rather than a gradual drift over the following year.