Price Increase Revenue Impact Calculator
Calculate the revenue impact of raising your prices.
See how a price increase affects total revenue, assuming some customer loss.
Raising your prices is one of the highest-leverage moves in business. But it comes with a trade-off: higher revenue per customer vs. potential customer loss.
This trade-off is captured by price elasticity of demand — the concept that as price rises, demand tends to fall. The key question is: by how much?
The core formula:
New Revenue = New Price × Remaining Customers
Where:
New Price = Current Price × (1 + Price Increase %)Remaining Customers = Current Customers × (1 − Expected Churn %)
A key insight: small increases often win. Consider a business with 500 customers paying $99/month:
- Current Revenue: $49,500/month
- 10% price increase with 5% churn → New Revenue: $52,228 → +5.5% revenue
Even losing 5% of customers, the 10% price increase generates more revenue overall. In fact, a 10% price increase requires less than 10% churn to still come out ahead.
Research on customer acceptance: Studies consistently show that customers generally accept price increases of 5–15% without significant churn, especially when:
- The product delivers clear value
- The increase is communicated transparently
- It is framed as a response to inflation or added features
When price increases are warranted:
- Inflation has raised your costs
- You have added meaningful new features or services
- You are repositioning toward a premium market segment
- Your prices have not changed in 2+ years
When to be cautious:
- High competition with easy switching
- Commodity products with no differentiation
- Customers already expressing price sensitivity
Use this calculator to model different scenarios before committing to a change.