Charm Price Rounding Calculator

How it works

Pricing formulas produce awkward numbers such as $41.67. Retail prices often end in a fixed pattern: just under a whole dollar (.99 or .95), just under a half dollar (.49), on a whole dollar, or on a round $5 or $10. These are often called charm or psychological prices.

The calculator lists every price with the chosen ending (for .99: $40.99, $41.99, $42.99 …) and picks the nearest one at or above your calculated price when rounding up, or at or below it when rounding down. A price that already has the ending is left unchanged.

Because rounding moves the price, it moves the margin too. Rounding up adds to the margin; rounding down takes from it. The margin and markup at the rounded price are recalculated from your unit cost so the effect is visible.

Formula

candidates     = k + ending   (k = 0, 1, 2 …; or multiples of $5 or $10)
rounded (up)   = smallest candidate ≥ calculated price
rounded (down) = largest candidate ≤ calculated price
margin %       = (rounded − cost) ÷ rounded × 100
markup %       = (rounded − cost) ÷ cost × 100

Example

A product costing $25 is priced for a 40% margin at $41.67. Rounded up to .99 it becomes $41.99, $0.32 more, and the margin rises to 40.46% (a 67.96% markup). Rounded down to .99 it would be $40.99, with a 39.01% margin.

Rounded to a multiple of $5, $24.30 goes up to $25 or down to $20, and to a whole dollar $6.70 goes up to $7 or down to $6, the same results as Excel's CEILING.MATH and FLOOR.MATH.

Assumptions and limitations

• The calculator only rounds. It does not estimate how an ending affects sales volume, which depends on the product, the shopper and the competition.
• Prices are in dollars and cents. The .99, .95, .49 and .00 endings repeat every dollar; the $5 and $10 options are whole multiples.
• Margin and markup use the unit cost you enter; fees, discounts and taxes are not included.
• Results are for informational and educational purposes and are not financial, tax or accounting advice.

Frequently asked questions