Cost-up or RRP-down? Choosing the right formula for each price tier

Every formula-driven tier answers one question: what number do you trust more — your cost, or your RRP?

Cost-up: margin first

Cost × markup protects margin by construction. If cost rises, price follows automatically. Best when your costs move often, or when margin discipline is the priority — typically your Trade and Wholesale tiers. The risk: your price drifts out of line with the market if competitors do not share your cost base.

RRP-down: market first

RRP × discount keeps you anchored to what the market expects to pay. Best when RRP is genuinely meaningful in your category — branded goods, published price lists — and for tiers close to retail. The risk: a supplier RRP cut can quietly crush your margin unless you watch the spread against cost.

Mix them

There is no rule that all tiers use the same base. A common pattern: Trade and Wholesale cost-up (margin protection where volume lives), retail-adjacent tiers RRP-down (market alignment where customers compare). Add attractive rounding so formula outputs land on sellable numbers.

B2B Price Tiers supports either base per tier, with rounding built in — set once, recalculate forever.

Questions, or want a tool we don't have yet? Email hello@grafto.co.uk — a real person replies.