Why is "Cutting the Sharing pack's price far below its guidance range and forgetting to check the Golden Rule" a common mistake when using the Pack-Size Elasticity Calculator?

Symptom: The Sharing pack's price per kilo looks like a generous saving, and the Golden Rule panel turns red, because the cut has taken its shelf price below the Multipack's $2.50. Fix: The floor comes first. A larger pack priced under the pack beneath it on the shelf sends shoppers to the big pack and stops the small one selling, however good the per-kilo reading looks. On this ladder the Sharing pack's shelf price has to stay at $2.50 or above, the Multipack's price. Its guidance range, $2.80 to $3.40, already sits above $2.50, so the floor only comes into play when a deep promotion pushes the Sharing pack under $2.50. When a deal really has to go that low, run it as a multi-buy (two packs for a set price). Then check two prices against the $2.50 floor: the single pack on the shelf, and the multi-buy price divided by the number of packs.

Why is "Reaching for the big pack when the break is small" a common mistake when using the Pack-Size Elasticity Calculator?

Symptom: The Sharing pack sits at index 92, so it saves the shopper only 8 percent per kilo. The plan is to cut its price by 16 percent, only because it is the pack whose label in the table looks wrong. Fix: The problem is how the Sharing pack's price per kilo compares with the Multipack's, so moving either pack can fix it. When the Sharing pack is only a little too expensive, raising the everyday pack can usually do the job alone. Raising the Multipack to $2.71, an 8 percent rise, lands the Sharing pack at index 85 without touching its margin. The 16 percent cut, on a pack at $3.68 earning a 35 percent gross margin on what you receive, needs 82 percent more volume just to hold gross profit. Work out the size of that rise before you plan anything else: the rise the Multipack needs is the Sharing pack's index divided by 85, minus one, which lands the Sharing pack at the top of its guidance range. When the Sharing pack is far too expensive per kilo, that rise goes past anything this shelf will carry, and cutting the Sharing pack is the only real repair. When it is only a little too expensive, the rise is usually the cheaper of the two.

Why is "Judging every pack against the Sharing pack's 70 to 85 range" a common mistake when using the Pack-Size Elasticity Calculator?

Symptom: The Single at index 120 and the Gift box at 130 both look broken, so the plan changes the price of three packs when only one of them is wrong. Fix: Each role has its own marker. An Entry pack, the smallest size, sits around 110 to 130 because a small pack costs more per kilo and shoppers choose it for its low shelf price. An Upscale pack, the premium or gift format, sits at 120 and above because it is built to earn more per kilo and sits outside the value ladder, the run of packs where bigger means cheaper per kilo. Judge each pack against the range for its own role and, at the default prices, exactly one pack is out of place: the Sharing pack at 134. The one fixed rule applies to the Upsize pack only: it has to cost less per kilo than the everyday pack.

Why is "Assuming that a cut the promise panel is happy with is a cut the pack can afford" a common mistake when using the Pack-Size Elasticity Calculator?

Symptom: The Sharing pack reads on guidance at $3.10 and the plan goes to the buyer without anyone asking what a 42 percent cut does to a 35 percent gross margin. Fix: The tool measures the shelf and not your profit and loss. Run the break-even test from Pricing Lesson 2 on the pack you are cutting, with the price change keeping its minus sign: break-even elasticity = -1 / (gross margin + price change). A 20 percent cut on a 35 percent margin needs an elasticity past -6.67, far steeper than either published average quoted in Pricing Lesson 1 (-1.76 and -2.62). A cut as deep as the margin or deeper has no break-even at all, because you are then paid no more for each pack than it costs to make. What genuinely pays for a deep per-kilo gap is a bigger pack that costs less per kilo to make, retailer funding, or volume the category did not have. If none of the three is there, the repair belongs on the everyday pack or on the size of the pack itself.

Why is "Expecting an elasticity or a volume forecast from this tool" a common mistake when using the Pack-Size Elasticity Calculator?

Symptom: You want to know how much your sales would move with price, as an elasticity such as -0.8, or a sales forecast for the ladder once it is fixed. The tool gives you only an index, such as 134. Fix: This tool does not model volume, so it will not tell you what a steeper curve sells, and it does not produce an elasticity. Both are measured on your own packs, from checkout scanner sales or data on what shoppers buy. The [Price Elasticity Calculator](/tools/price-elasticity-calculator) is the separate tool that turns a measured elasticity into an answer in volume and profit. What this tool does show is the price information shoppers actually see: the price per kilo of each pack, and the index that turns it into a single score. It also shows whether the ladder keeps the two rules that hold in every category: the promise that a bigger pack costs less per kilo, and the Golden Rule on shelf prices. The lesson describes the broad patterns published work shows for how Entry, Routine, Upsize and Upscale packs tend to respond to price, and treats them as patterns only, because the real numbers for your ladder depend on your category, your country and your shoppers.

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Pack-Size Elasticity Calculator

Draw the incentive curve, the line of price per kilo across four pack sizes, and read every pack as an index against the everyday pack at 100. Price the bigger Sharing pack so it costs less per kilo than the everyday Multipack. The guidance range practitioners aim for is roughly index 70 to 85, where the Sharing pack costs 15 to 30 percent less per kilo. There are two ways to get it there, cutting the Sharing pack or raising the Multipack, and the tool works out the new price each one needs. Then check the Golden Rule, which says no larger pack may sell for less on the shelf than the pack below it, before you take a pack-price review to the buyer. It is the same interactive model the full RGM Academy course uses in Price Pack Architecture Lesson 3, free to use with no sign-in.

Updated 19 September 2026Extracted from the Price Pack Architecture module, lesson 3: Incentive Curve

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Guided walkthrough

Explore the tool, from setup to common mistakes

Five short sections explain the scenario, what each control does, how to read the output, and the mistakes to avoid. Open whichever helps. The tool above works without them.

5.1Scenario setup

The starting SKU, market, and assumptions the model makes.

You look after pack‑price architecture for a biscuit brand, and the annual category review with a large grocery retailer is on Friday. The buyer has flagged that your 400g Sharing pack is missing its volume plan. Shoppers keep picking the 250g Multipack, and once you do the division you can see why. The Multipack is $2.50, which is $10.00 a kilo. The Sharing pack is $5.36, which is $13.40 a kilo, so the bigger pack costs 34 percent MORE per kilo than the everyday one. A shopper who wants about half a kilo of biscuits pays $5.00 for two Multipacks and gets 500g, or $5.36 for one Sharing pack and gets 400g. More money for less product, so nothing pulls anyone up a size. The one promise a pack ladder makes, buy more and pay less per kilo, is broken at exactly the step meant to reward buying more.

Three things have to be settled before Friday. You need the corrected incentive curve, meaning the line of price per kilo across the four packs. You need a Sharing price you can defend in the room. It has to cost less per kilo than the Multipack, which is a rule rather than guidance. The guidance practitioners work to is written as an index, which scores each pack's price per kilo against the Multipack's, with the Multipack set at 100. It puts the Sharing pack at around 70 to 85, a saving of 15 to 30 percent per kilo, which here means a shelf price of $2.80 to $3.40. And you need to know which end of the ladder to move, because you can reach the same saving per kilo by cutting the Sharing pack or by raising the Multipack, and the two cost very different money. Then check the Golden Rule still holds, meaning no larger pack sits below a smaller one on the shelf price itself.

Your objective

Use the calculator to find where the incentive curve breaks, then work out what each way of fixing it would cost: cutting the Sharing pack, or raising the Multipack. Bring the Sharing pack's index inside the guidance range of roughly 70 to 85 without breaking the Golden Rule, and see which repair your ladder can actually afford.

Key assumptions

The Routine pack, here the Multipack, is the anchor: every other pack is measured against it, and it is fixed at index 100. Every other pack's index is its price per kilo divided by the Multipack's, times 100. So the Multipack always reads 100, simply because it is divided by itself, and when you move the Multipack's slider every other pack's index changes even though none of their prices has moved. Lift the Multipack 5 percent and every other index drops about 4.8 percent, because each one is now divided by a price 1.05 times bigger (1 / 1.05 = 0.952). That is why the Multipack is the most consequential slider on the page.
One rule and one range. The rule says the Sharing pack's price per kilo has to be lower than the Multipack's. A bigger pack promises the shopper a lower price per kilo. Once the Sharing pack reaches index 100 or above, it costs as much per kilo as the Multipack or more, and that promise is broken. The range is guidance, a starting point practitioners aim for. They price an Upsize pack like the Sharing pack, the size that rewards buying bigger, at roughly index 70 to 85. That is a saving of 15 to 30 percent per kilo against the Multipack. At the default Multipack price of $10.00 a kilo that means a Sharing price per kilo of $7.00 to $8.50, which at 400g is a shelf price of $2.80 to $3.40. Most shoppers do not notice a saving of less than about 10 percent per kilo when they stand at the shelf, so a ladder can keep its promise and still change nobody's behavior. Price the Sharing pack below index 70 and you have to sell more packs to pay for the deeper saving. Whether the extra sales pay for it is a break‑even calculation you run on your own numbers, so a saving deeper than the range is not wrong in itself.
Golden Rule: the shelf price has to rise with pack weight. Sort the ladder by weight (Single 150g, Multipack 250g, Sharing 400g, Gift box 500g) and every pack's shelf price has to sit at or above the pack beneath it. If the Sharing pack ends up cheaper on the shelf than the Multipack, shoppers buy the bigger pack instead of the smaller one and your highest‑volume pack stops selling for as long as the prices stay that way. The tool checks every neighboring pair and names the first one that breaks.
The same broken ladder has two repairs, and they are not the same decision. Cut the Sharing pack to the middle of the guidance range and you pay for the fix out of that pack's own margin, because you now earn less on every Sharing pack you sell. At the default prices the cut takes it to $3.10, a 42 percent cut. Raise the Multipack instead, so the Sharing pack ends up the same distance below it per kilo, and you put up the price of your highest‑volume pack. That brings money in, and it puts at risk the sales you can least afford to lose: at the default prices the Multipack would have to go to $4.32, a 73 percent rise. The tool works out both repairs at whatever prices you have set and leaves the choice to you. It also warns you when the Multipack would need a price above the highest one this shelf will take. That warning is the finding most people miss.
The pack sizes are fixed here. You can change prices and nothing else. Choosing which pack sizes to offer comes first, and PPA Lesson 2 (Pack Roles) covers it. Setting a price for each of those sizes along the incentive curve is the second step, and it is the one this tool handles. When neither repair is affordable, the pack is usually the wrong size rather than the wrong price. A 450g pack at $3.60 lands at the same $8.00 a kilo as a 400g at $3.20, and it keeps a shelf price that reads as a normal biscuit price. Redesigning the range is PPA Lesson 4 and Lesson 6.

5.2Controls & toggles

Every input the calculator exposes, its range, and what it changes.

Control	Range	Default	What it changes
Entry (Single, 150g) price slider	$1.20 to $2.40 in $0.01 steps	$1.80 (150g, $12.00 a kilo, index 120)	Shelf price of the smallest pack, the one bought for trial or on the go. The guidance for an Entry pack is roughly index 110 to 130 against the Multipack. A small pack costs more per kilo, and shoppers pick it for its low shelf price rather than for how much biscuit the money buys. So a Single that costs more per kilo than the Multipack is not a fault. The ladder table under the chart judges it against the Entry range of 110 to 130, rather than the Sharing pack's 70 to 85. Price it too low and it takes sales from the Multipack; too high and it stops bringing in the shoppers who wanted to try the brand.
Routine (Multipack, 250g) price slider	$1.80 to $3.50 in $0.01 steps	$2.50 (250g, $10.00 a kilo, the anchor at index 100)	The everyday pack, and the anchor. It always reads index 100, because every other pack's price per kilo is measured as a percentage of this one's. Move this slider and every other pack's index moves without any of them changing price: lift it 5 percent and the others drop about 4.8 percent each, because each index is divided by a Multipack price that is now 1.05 times bigger. When the Sharing pack is only a little too expensive per kilo, raising this slider is usually the cheaper way to fix it. When it is far too expensive, the rise you would need goes past the top of this slider, and the tool tells you so.
Upsize (Sharing, 400g) price slider	$2.20 to $6.50 in $0.01 steps	$5.36 (400g, $13.40 a kilo, index 134, the broken step)	The trade‑up pack, and the most important slider here. One thing is a rule: it has to cost less per kilo than the Multipack. How much less is guidance, usually somewhere around index 70 to 85. That is a saving of 15 to 30 percent per kilo for the shopper, and at the default Multipack price it means a Sharing pack shelf price of $2.80 to $3.40. The slider will let you drag it below the Multipack's shelf price; the Golden Rule panel then turns red rather than the drag being blocked, so you can see what the break looks like.
Upscale (Gift box, 500g) price slider	$4.50 to $7.50 in $0.01 steps	$6.50 (500g, $13.00 a kilo, index 130)	The premium pack. Guidance is index 120 and above. A premium or gift format is built to earn MORE per kilo, and it sits outside the value ladder, the run of packs where bigger means cheaper per kilo, so a high index here is what the design intends. Read it against its own marker rather than against the Sharing pack's. It is also the heaviest pack, so the Golden Rule needs its shelf price to sit at or above the Sharing pack's. Drag it down to its $4.50 minimum while the Sharing pack is still at $5.36 and the Gift box becomes cheaper on the shelf than the lighter Sharing pack, which breaks the rule.
The promise panel	first whether the bigger pack is cheaper per kilo (kept or broken), then how big the saving is and how far the pack sits from its guidance range	broken at the default prices, because the Sharing pack sits at index 134 and costs more per kilo than the Multipack	One of the two places this tool gives a straight yes or no, and the one about price per kilo. The promise panel turns red as soon as the Sharing pack costs as much per kilo as the Multipack, or more. From that point the bigger pack is no longer the better deal for the shopper, and that holds whatever the category, the channel or your market share. When the Sharing pack's index is below 100, the panel turns green and its headline gives the saving per kilo a shopper gets for buying bigger. It warns you when that saving is under about 10 percent, because most shoppers do not notice it. How far each pack sits from the guidance range for its role is in the pack ladder table: a pack outside its range is flagged in amber, a distance for you to weigh, while red is kept for the two rules.
The two repairs	two shelf prices and a shallower third, each with its percentage move	cut the Sharing pack to $3.10 (42 percent), or raise the Multipack to $4.32 (73 percent, above what this shelf carries)	The repairs appear whenever the Sharing pack costs as much per kilo as the Multipack or more, or saves the shopper less than about 10 percent. The panel works out the shelf price each fix needs at your current prices, aiming both at the middle of the guidance range: cut the Sharing pack, or raise the Multipack. A third line aims the Multipack rise at the top of the range instead, which asks for a smaller rise and still leaves the Sharing pack cheaper per kilo than the Multipack. The panel does not pick a winner, and it warns you when a repair needs a Multipack price above $3.50, the highest this shelf will carry. At the default prices, both Multipack rises go above that limit.
Golden Rule panel	OK or Violation, naming the pair that breaks	OK at the default prices ($1.80 < $2.50 < $5.36 < $6.50 by weight)	Sorts the packs by weight (150g, 250g, 400g, 500g) and checks that each pack's shelf price sits at or above the pack beneath it. A violation means a larger pack is cheaper on the shelf edge than the pack one size smaller, so shoppers buy the bigger one instead of the smaller one. The panel names the first pair that breaks.

5.3Step-by-step exploration

7-step guided exploration of the scenario.

Read the default broken curve, where a lot of real ladders start
Leave every slider where it is. Read the promise panel first: it checks whether the bigger pack is cheaper per kilo. Then read the pack ladder table under the chart, which lists every pack side by side.
Expected outcome: The Sharing pack at $5.36 is $13.40 a kilo, an index of 134 against the Multipack's $10.00, so the promise panel is red: the bigger pack costs 34 percent MORE per kilo than the everyday one. The Golden Rule panel reads OK, because the shelf prices still rise with weight ($1.80, $2.50, $5.36, $6.50). The starting prices show something useful: a ladder can pass one of the two checks and fail the other. In the table, the Single at index 120 shows On guidance, because it sits inside the 110 to 130 range for an Entry pack. The Multipack shows Anchor, because it is the pack every other pack is measured against. The Gift box at 130 shows On guidance for a premium pack. The Sharing pack is the only one outside the range for its role. If you judged the Single and the Gift box against the Sharing pack's 70 to 85 band as well, you would flag three packs as problems. Judge each pack against the range for its own role and only the pack that is actually broken gets flagged. Ladders end up like this without anybody deciding it. A flat price rise applied per pack rather than per kilo hits the big pack hardest. The everyday pack gets promoted and the big pack does not. Or the big pack gets rounded up to a shelf‑friendly number and nobody converts it back to price per kilo.
Repair one: cut the Sharing pack's price into its guidance range
Drag the Sharing slider from $5.36 down to $3.10, the price the two‑repairs panel quotes for the middle of the range.
Expected outcome: The Sharing pack is now $7.75 a kilo, index 77.5 (the ladder table rounds it to 78), and the promise panel turns green. Buying bigger now saves the shopper 22.5 percent per kilo, which the promise panel rounds to 23. That is well above the roughly 10 percent a shopper needs before they notice a saving. The Golden Rule still holds, because $3.10 sits above the Multipack's $2.50. Now ask what the cut costs, because the panel measures the shelf and not your margin. It is a 42 percent cut. Suppose the retailer keeps 30 percent of the shelf price, front and back margin together, so you receive the other 70 percent: $3.75 of the $5.36. At a 35 percent gross margin on what you receive, the pack costs you $2.44 to make ($3.75 x 0.65). At a $3.10 shelf price you receive $2.17, so every pack loses you $0.27, and the more of them the new price sells, the bigger the loss. A cut deeper than the pack's gross margin has no break‑even volume at all. At these prices the Sharing pack's own margin cannot pay for a cut this deep, and that is the point of the lesson. The curve shows you where the pack's price per kilo should sit, and your own margin tells you whether the pack can afford to get there.
Repair two: try raising the Multipack instead of cutting the Sharing pack
Reset. Look again at the two‑repairs panel, then drag the Multipack's price slider up to its $3.50 maximum and leave the Sharing pack at $5.36.
Expected outcome: The panel says that to give the Sharing pack the same saving per kilo as the cut in step 2, the Multipack alone would have to reach $4.32, a 73 percent rise. Even if you aim only for the top of the guidance range, where the saving is smallest, the Multipack still has to reach $3.94. Both prices are above $3.50, the most this shelf will carry for the Multipack. So when the Sharing pack is this far out of line, raising the everyday pack is not a real option. The Sharing pack is the one priced wrongly, so it is the pack you have to move. Push the Multipack to $3.50 anyway and watch what the anchor does to everything else. It is now $14.00 a kilo, a 40 percent rise, and every other pack re‑indexes without moving. The Single drops from 120 to 86, so the smallest pack now costs less per kilo than the everyday one and the ladder is upside down at its first step. The Sharing pack drops from 134 to 96, technically under 100 but saving the shopper 4 percent, which almost nobody sees. And the Gift box drops from 130 to 93, well under its 120 marker. Changing the Multipack's price, the anchor the others are measured against, has the biggest effect of anything on the page and deserves the most careful reading, because it moves four numbers at once.
The half‑measure: keep the rule with a saving nobody notices
Reset. Drag the Sharing slider to $3.95.
Expected outcome: The Sharing pack is $9.88 a kilo, index 99, so it now costs less per kilo than the Multipack and the rule is technically kept. The promise panel turns green, but its headline gives a saving of just 1 percent, and the line under it says a saving that small is one most shoppers do not notice. You have given up $1.41 a pack of shelf price ($5.36 down to $3.95) for a saving most shoppers do not register as a difference at all. That is the most expensive place on the ladder to sit: the discount is real on your profit and loss and invisible on the shelf. The box under the chart agrees: at index 99 the Sharing pack sits above its guidance band, just under the dashed Multipack line. Getting the index just under 100 keeps the promise on paper and nowhere else, which is why the tool shows the size of the saving next to the kept‑or‑broken reading instead of that reading on its own.
Ladder two: a small break, where the anchor repair wins
Reset. Treat this as a second range, whose Sharing pack sits at $3.68 on the shelf and earns a 35 percent gross margin on what you receive, so it costs less to make than the pack in step 2. Set the Sharing pack to $3.68 and read the two‑repairs panel.
Expected outcome: The Sharing pack is $9.20 a kilo, index 92. The bigger pack is still cheaper per kilo, so the promise holds, but the saving is only 8 percent, too small for most shoppers to notice, so the repairs panel appears and prices both fixes. Cut the Sharing pack to $3.10, a 16 percent cut, or raise the Multipack to $2.97, a 19 percent rise, and either one lands the Sharing pack in the middle of the range. Aim at the top of the range instead and the Multipack only has to reach $2.71, an 8 percent rise. Price the cut first: 15.8 percent off a pack running a 35 percent gross margin on what you receive needs 82 percent more volume just to hold gross profit, a break‑even elasticity of -5.2, far steeper than either published average quoted in Pricing Lesson 1 (-1.76 and -2.62). The 8 percent rise closes the same gap without touching the Sharing pack's margin, and a price rise brings money in on every pack that still sells, where a cut gives money away on every pack. There is a quick way to size it before you touch a slider: the rise the everyday pack needs to take the big pack to index 85 is the big pack's index divided by 85, minus one. At index 92 that is 8 percent, a hard conversation but a real one. On the ladder you started with, where the Sharing pack sits at index 134, it is 58 percent, a rise far too big to take to a buyer. The size of the break decides which repairs exist before you have thought about which one you prefer.
Apply the anchor repair and read the whole ladder, not one pack
Keep the Sharing pack at $3.68. Drag the Multipack up to $2.71.
Expected outcome: The Multipack is now $10.84 a kilo. The Sharing pack now shows index 85, inside its guidance range. That is a 15 percent saving per kilo, big enough for a shopper to notice, and you never touched its price. The indexes of the other two packs moved too, because the Multipack they are measured against moved, so check them every time you change the Multipack. The Single now shows index 111, still inside the guidance range for an Entry pack. The Gift box shows 120 but is labeled Near guidance rather than On guidance, because its exact index is 119.9, just under its 120 marker. The table labels any pack within eight points of its range as Near guidance, so the label is expected and nothing needs fixing. The Golden Rule holds throughout, because $2.71 still sits between the Single's $1.80 and the Sharing pack's $3.68. This is the version you can put in front of a buyer. The ladder is fixed, the price rise on the everyday pack brings in extra money, and the big pack's price does not change at all. Whether it survives the shelf is a question for the Multipack's own price elasticity, which is Pricing Lesson 1.
Price the Sharing pack under the Multipack, then fix it with a multi‑buy
Reset. Drag the Sharing pack's slider down to $2.30, the kind of price a deep discount in a retailer's promotional leaflet can reach.
Expected outcome: Per kilo, the Sharing pack now costs $5.75, index 57, so on the chart it looks like a generous saving. It makes no difference, because the Golden Rule panel turns red and names the pair of packs that breaks it: Sharing at $2.30 is below Multipack at $2.50. A shopper who was buying the Multipack at $2.50 now takes the Sharing pack for less money and more biscuits, and the Multipack, your highest‑volume pack, stops selling for as long as the deal runs. That is why you read the Golden Rule first: while a larger pack is cheaper on the shelf than the smaller pack below it, nothing else the page tells you matters. Where a deal genuinely has to reach that price, the fix is a multi‑buy rather than a single‑unit cut. Two Sharing packs for $7.99 hands the shopper $4.00 a pack, a saving of 25 percent against $10.72 for two at the shelf price, while the single‑unit shelf price stays at $5.36 and the Multipack's $2.50 stays the cheapest single pack on the shelf. Check each pack's price inside the bundle (the bundle price divided by the number of packs) against the floor as well, the floor being the Multipack's shelf price that no larger pack may go under: $4.00 clears $2.50, and a deal at two for $4.80 would not. A 30 percent deal on the Sharing pack, to $3.75, clears the floor too.

5.4Reading the output

Every KPI, the formula behind it, and how to interpret a positive or negative value.

KPI	Formula	How to read it
RSP/kg (per pack)	shelf price divided by (weight in grams divided by 1000)	The price per kilo of each pack, and the number a pack ladder is built on. It is what a shopper is comparing when they choose between sizes, even when they never consciously work it out, and it is what unit pricing on the shelf edge prints for them where it is required.
Index (per pack)	(pack RSP/kg divided by Routine RSP/kg) x 100	Every pack's price per kilo on a scale where the Multipack is 100. Guidance by role: Entry roughly 110 to 130, Routine 100 by construction, Upsize roughly 70 to 85, Upscale 120 and above. These are starting points that practitioners use, and no study has settled them. So the tool reports how far each pack sits from the range for its role, and a pack up to eight points outside that range gets the label Near guidance. A Sharing pack above index 90 never gets that label, because it saves the shopper under 10 percent per kilo, too little to notice. An index is a ratio, so changing the Multipack price moves every other index at once.
The promise a bigger pack makes	Upsize index below 100, and the saving is 100 minus the index	One of the two fixed rules on the page, alongside the Golden Rule on the shelf price. At index 100 or above, the bigger pack costs as much per kilo as the everyday Multipack or more, so the promise fails, and that is true in every category. Below that the panel reports the saving, and a saving under about 10 percent is one most shoppers do not notice, so the ladder can pass the rule and change nobody's behavior. A ladder inside guidance is where the Triple Win the lesson describes lives: the shopper pays less per kilo, the retailer's category grows in value, and the maker earns longer production runs.
The two repairs	Cut: Multipack price per kilo x 0.775 x Sharing pack weight in kg. Raise: (Sharing pack price per kilo / 0.775) x Multipack weight in kg. Shallow raise: the raise again, using 0.85	Both reach the same index and cost very different money. The cut spends margin on the pack you cut, on every unit including the ones that were selling fine, and has to earn it back in volume. Run the break‑even test from Pricing Lesson 2 on the cut: it tells you how many more packs you must sell to earn the same gross profit as before. And remember that a cut deeper than the pack's gross margin can never break even, because you are then paid less for every pack than it costs to make. The rise brings money in on every pack that still sells and risks the volume on your biggest seller. The panel also says when the rise is higher than this shelf carries, and on a big break it usually is.
Golden Rule	sort the packs by weight, then check that each pack's shelf price is at least the price of the pack beneath it	The shelf price has to rise with pack weight. A violation means shoppers buy the larger pack because it is cheaper on the tag, and the smaller pack stops selling. Read this panel first, because while it is red the per‑kilo readings describe a ladder nobody is buying from. The usual fix on a promotion is a multi‑buy, and the bundle price divided by the number of packs still has to clear the smaller pack's shelf price.
Ladder reading (per row)	each pack's index, compared with the guidance range for that pack's role. A pack up to eight points outside its range gets the label Near guidance. A Sharing pack above index 90 never gets that label, because it saves the shopper under 10 percent per kilo, too little to notice	Per pack: 'Anchor' for the Multipack, because the others are measured against it. Every other pack shows 'On guidance' when it sits inside the range for its role and 'Near guidance' when it is just outside. When it is further out, the column shows the pack's guidance range instead. The column tells you how far a pack is from its range without calling it right or wrong, because the ranges are only starting points, and a pack a few points outside is within the room for error those numbers carry. An Entry pack at 110 to 130 and a Gift box at 120 or above both show On guidance, because small packs and premium packs are meant to cost more per kilo than the everyday pack.

Read the Golden Rule panel first, because while a larger pack sits below the pack beneath it on the shelf, nothing else on the page describes a ladder shoppers are actually buying from. Then read the promise panel, the most important reading in the whole analysis. If the Sharing pack's index is below 100, the bigger pack is cheaper per kilo and the promise is kept, and the size of the saving tells you whether shoppers will notice it. Then read the two repairs. Before you propose the cut, test it against your own gross margin, because the panel only looks at shelf prices and knows nothing about your costs or margins. The pack ladder table is the per‑pack detail you take into the category review. When you cannot afford either repair at prices this shelf will carry, the problem is usually the pack's size, and its price is the wrong thing to change. Choosing which sizes to offer is range design, the subject of PPA Lesson 2, Lesson 4 and Lesson 6, and a price slider will not answer it.

5.55 common mistakes to avoid

Diagnostic patterns that catch the most common misuse of this calculator.

Mistake 1Cutting the Sharing pack's price far below its guidance range and forgetting to check the Golden Rule
Symptom: The Sharing pack's price per kilo looks like a generous saving, and the Golden Rule panel turns red, because the cut has taken its shelf price below the Multipack's $2.50.
Fix: The floor comes first. A larger pack priced under the pack beneath it on the shelf sends shoppers to the big pack and stops the small one selling, however good the per‑kilo reading looks. On this ladder the Sharing pack's shelf price has to stay at $2.50 or above, the Multipack's price. Its guidance range, $2.80 to $3.40, already sits above $2.50, so the floor only comes into play when a deep promotion pushes the Sharing pack under $2.50. When a deal really has to go that low, run it as a multi‑buy (two packs for a set price). Then check two prices against the $2.50 floor: the single pack on the shelf, and the multi‑buy price divided by the number of packs.
Mistake 2Reaching for the big pack when the break is small
Symptom: The Sharing pack sits at index 92, so it saves the shopper only 8 percent per kilo. The plan is to cut its price by 16 percent, only because it is the pack whose label in the table looks wrong.
Fix: The problem is how the Sharing pack's price per kilo compares with the Multipack's, so moving either pack can fix it. When the Sharing pack is only a little too expensive, raising the everyday pack can usually do the job alone. Raising the Multipack to $2.71, an 8 percent rise, lands the Sharing pack at index 85 without touching its margin. The 16 percent cut, on a pack at $3.68 earning a 35 percent gross margin on what you receive, needs 82 percent more volume just to hold gross profit. Work out the size of that rise before you plan anything else: the rise the Multipack needs is the Sharing pack's index divided by 85, minus one, which lands the Sharing pack at the top of its guidance range. When the Sharing pack is far too expensive per kilo, that rise goes past anything this shelf will carry, and cutting the Sharing pack is the only real repair. When it is only a little too expensive, the rise is usually the cheaper of the two.
Mistake 3Judging every pack against the Sharing pack's 70 to 85 range
Symptom: The Single at index 120 and the Gift box at 130 both look broken, so the plan changes the price of three packs when only one of them is wrong.
Fix: Each role has its own marker. An Entry pack, the smallest size, sits around 110 to 130 because a small pack costs more per kilo and shoppers choose it for its low shelf price. An Upscale pack, the premium or gift format, sits at 120 and above because it is built to earn more per kilo and sits outside the value ladder, the run of packs where bigger means cheaper per kilo. Judge each pack against the range for its own role and, at the default prices, exactly one pack is out of place: the Sharing pack at 134. The one fixed rule applies to the Upsize pack only: it has to cost less per kilo than the everyday pack.
Mistake 4Assuming that a cut the promise panel is happy with is a cut the pack can afford
Symptom: The Sharing pack reads on guidance at $3.10 and the plan goes to the buyer without anyone asking what a 42 percent cut does to a 35 percent gross margin.
Fix: The tool measures the shelf and not your profit and loss. Run the break‑even test from Pricing Lesson 2 on the pack you are cutting, with the price change keeping its minus sign: break‑even elasticity = -1 / (gross margin + price change). A 20 percent cut on a 35 percent margin needs an elasticity past -6.67, far steeper than either published average quoted in Pricing Lesson 1 (-1.76 and -2.62). A cut as deep as the margin or deeper has no break‑even at all, because you are then paid no more for each pack than it costs to make. What genuinely pays for a deep per‑kilo gap is a bigger pack that costs less per kilo to make, retailer funding, or volume the category did not have. If none of the three is there, the repair belongs on the everyday pack or on the size of the pack itself.
Mistake 5Expecting an elasticity or a volume forecast from this tool
Symptom: You want to know how much your sales would move with price, as an elasticity such as -0.8, or a sales forecast for the ladder once it is fixed. The tool gives you only an index, such as 134.
Fix: This tool does not model volume, so it will not tell you what a steeper curve sells, and it does not produce an elasticity. Both are measured on your own packs, from checkout scanner sales or data on what shoppers buy. The Price Elasticity Calculator is the separate tool that turns a measured elasticity into an answer in volume and profit. What this tool does show is the price information shoppers actually see: the price per kilo of each pack, and the index that turns it into a single score. It also shows whether the ladder keeps the two rules that hold in every category: the promise that a bigger pack costs less per kilo, and the Golden Rule on shelf prices. The lesson describes the broad patterns published work shows for how Entry, Routine, Upsize and Upscale packs tend to respond to price, and treats them as patterns only, because the real numbers for your ladder depend on your category, your country and your shoppers.

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