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.
Weighted Average Price Calculator Download
The weighted average price calculator is available for download in Excel format by following the link below.
Users use the weighted average price template to generate the average product selling price at their own risk. We make no warranty or representation as to its accuracy. We are covered by the terms of our legal disclaimer, which you are deemed to have read. This is an example of a weighted average formula spreadsheet that you might use when producing financial projections. It is purely illustrative of a weighted average calculator. This is not intended to reflect general standards or targets for any particular company or sector. If you do spot a mistake in this weighted average formula calculator, please let us know and we will try to fix it.
About the Author
Chartered accountant Michael Brown is the founder and CEO of Plan Projections. He has worked as an accountant and consultant for more than 25 years and has built financial models for all types of industries. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. He has been a manager and an auditor with Deloitte, a big 4 accountancy firm, and holds a degree from Loughborough University.