# Weighted Average Price Calculator

This weighted average price calculator will help you to estimate the average product selling price for your business for use in the Financial Projections Template.

Generally a business will have a number of product lines and know the selling price on each. Consequently to calculate the weighted average selling price for the business it is necessary to weight each product selling price by its corresponding sales mix percentage. The template is particularly useful for a Saas business model where the business offers multi-level subscription fees to customers.

The Excel sheet is available for download below. The sheet calculates the weighted average price by entering the sales mix percentage and selling price for up to four product lines.

## Weighted Average Example

To illustrate suppose a business sells four products with price and sales mix % as shown in the diagram above. The calculation carried out by the calculator is as follows.

```Weighted average price = Mix% 1 x Price 1 + Mix% 2 x Price 2 ...... for each of the 4 products
Weighted average price = 70% x 9.99 + 25% x 29.99 + 4% x 49.99 +1% x 99.99
Weighted average price = 17.49```

In this case the sales mix bias is towards the lower price products. Consequently although a small percentage of the products have high prices the weighted average for the four products is much lower at 17.49.