Cost Break Analysis

What is this?

Cost Break Analysis divides your products into cost ranges (brackets) and shows you the profitability of each range. Each level can be priced two ways: set a target margin (e.g., 40% for items costing $0–$4), or set a fixed retail price (e.g., every item in the $0–$4 cost range prices at exactly $5.00). You can mix both modes within the same model. Cost break models can be referenced by pricing strategy steps.

Walk through it in the app: guide 2023 — Cost break pricing. Margin Master can walk you through these steps live: turn on Training / Guide Mode from the Help menu, then type 2023 into the Lessons & Guides box — or ask Margin Master support to run it with you.

Opening Cost Break Analysis

1. Model · 2. Break Points · 3. Cost break levels grid · 4. Delete / Reset / Save / Close

• Menu: Strategy > Manage Cost Breaks
• Toolbar: Click the "Show Cost Break Model for Selection" button

The window title is "Manage Cost Breaks".

Cost Break Model Selection

At the top, a dropdown lists your saved cost break models (displays name). If no models exist, red text shows "No Cost Break Models Found".

Model Actions (Hamburger Menu)

Model Options

Break Type

Choose how cost ranges are defined:

Break Points (Manual mode only)

A spin edit (2-15) controls how many levels the model has. Error tooltip: "Must be at least 2 Break Points and no more than 15."

Options

Click "Rebuild" (refresh icon) to manually recalculate.

Cost Break Levels Grid

The main grid shows each cost level:

Editing From/To ranges: The From amount of the first level and the To amount of the last level cannot be edited (they represent the floor and ceiling).

Fixed Price vs. Target Margin

Each level uses one of two pricing modes:

• Target Margin mode (default): retail price is calculated as Cost ÷ (1 − Margin). Leave Fixed Price unchecked and enter a margin percentage.
• Fixed Price mode: every SKU in the range receives the same retail price regardless of its cost. Check Fixed Price and enter the dollar amount in Fixed $.

You can mix modes within a single model. For example, a paint cost break might use a $5.00 fixed price for quarts ($0–$4 cost) and a 38% target margin for gallons ($4–$12 cost).

Row Context Menu (Right-Click)

Buttons

Creating a New Model

1. Click Reset to start fresh, or the model will be created when you first open the manager
2. A name input dialog appears: "Enter Cost Break Name" (minimum 3 characters)
3. If the name exists, you'll see "Name Exists!" in red
4. Choose a break type and break count
5. Click Rebuild to populate the levels
6. Set your target margins for each level
7. Click Save

Excel Export

Current model export includes columns: Level, From Amount, To Amount, Sales, COGS, Gross, Sitting Margin, Target Margin, Active SKUs, Zero Sales SKUs.

All models export includes: Strategy Name, Level, From Amount, To Amount, Target Margin %.

Formats: Currency fields as $#,##0.00, margins as 0.00%, counts as #,##0.

Tips

Tip: Start with a Simple-10 or Simple-13 model, then adjust the break points based on your product mix.

Tip: Focus your margin targets on the cost ranges with the most active SKUs -- that's where small margin changes have the biggest impact.

Tip: Use the "Zero Sale Skus" column to identify dormant inventory that might need attention.

Common Questions

Q: What's the difference between "Calculated Margin" and "Target Margin"? A: Calculated Margin is your actual current margin for products in that cost range. Target Margin is what you want to achieve. The gap between them tells you where pricing adjustments are needed.

Q: Can I reference a cost break model from a pricing strategy? A: Yes. In the Future Price Panel, select "Cost Break" as the price level and choose your model from the dropdown.

Q: How are SKUs assigned to levels? A: Based on their store cost. A SKU with a cost of $7.50 falls into the level whose From-To range includes $7.50. Only SKUs with a current price greater than zero are included in margin calculations.

Q: Can I set a flat price for a cost range instead of a margin? A: Yes. Check the Fixed Price box on any level and enter the dollar amount in Fixed $. Margin Master will use that exact price for all SKUs in that cost range instead of calculating a margin-based retail price. You can mix fixed-price and margin lines within the same model.

Q: Can I have multiple cost break models? A: Yes. Create as many as you need for different analysis scenarios or strategy configurations.