The Revenue forecast chart illustrates the forecasted development of revenue for the following 30 days with the current selling price. It helps identify when revenue is expected to be higher or lower, and how the forecast changes over time.

The Profit forecast chart illustrates the forecasted development of profit for the following 30 days with the current selling price. The chart makes it possible to monitor how the profitability forecast changes over time and to identify the points where forecasted profit is at its highest or lowest.

The Sales volume forecast chart illustrates the forecasted development of sales volume for the following 30 days with the current selling price. The chart helps identify when unit sales are expected to be at their highest or lowest, and to assess sales variation..

The chart illustrates the impact of price changes on expected daily revenue. The line shows the forecasted revenue level under different pricing scenarios, and the orange shaded area represents forecast uncertainty or the expected range of variation. The wider the shaded area, the greater the uncertainty at that price-change level. The chart can be used to assess at which price level daily revenue would be higher or lower according to the forecast.

Expected daily profit illustrates the impact of price changes on expected daily profit. The line shows the forecasted profit level under different pricing scenarios, and the orange shaded area represents forecast uncertainty or the expected range of variation. The wider the shaded area, the greater the uncertainty at that price-change level. The chart can be used to assess at which price level daily profit would be higher or lower according to the forecast.

The Expected daily units sold chart shows how price changes affect the expected daily sales volume. The line represents forecasted unit sales under different pricing scenarios, and the orange shaded area represents forecast uncertainty or the expected range of variation. The wider the shaded area, the greater the uncertainty at that price-change level. The chart can be used to assess at which price level the daily sales volume would be higher or lower according to the forecast.

The Strategic pricing gateway chart illustrates the impact of price on overall profitability. The horizontal axis shows price, and the vertical axis shows the total profit index. The chart marks the current price, the suggested price, and the price floor and ceiling.

In the chart the suggested price point is based on the product’s historical data (how the sales of the product have been performing historically at different price points). The suggested price point in this chart is not a price point that is forecasted to earn the most amount of profit per sale, instead, the calculation behind the suggested price point puts equal weight to profit, revenue, and demand to determine the suggested price.

The price floor and ceiling used in the chart come from default safeguards used in pricing strategies. The default safeguards are:

Price ceiling: Price +10%

Price can only be increased by a maximum amount of 10% from the product’s current price at a given time.

Price floor: Price -10%

Price can only be decreased by a maximum amount of 10% from the product’s current price at a given time.

Price floor: Price with 10% Unit Margin %

Price needs to always achieve at least a 10% unit margin %.

The white area represents the price range where the model has sufficient underlying data to make an assessment. The grey areas outside the white area represent price points where there are not enough observations or where the estimate is more uncertain.

The following three charts help explain the pricing and profitability data behind the analysis: at which prices observations have been collected, how profit varies across different price levels, and what gross profit ultimately consists of.

The chart shows at which price points sales have occurred across different cycles (cycle = selected date range, e.g. past three months) and how they relate to the average profit level. The horizontal axis shows price, and the vertical axis shows average profit per cycle. Individual points represent observed price points, and the size of each point may illustrate the number of observations or sales at that price level. The chart helps show which price levels the data is concentrated around and at which prices profit has been higher or lower.

The chart shows the distribution of price points across different price levels. The horizontal axis shows price, and the vertical axis shows average profit per cycle (cycle = selected date range, e.g. past three months). The bars illustrate which prices have accumulated the most observations or sales. The chart helps identify the most common price levels and assess which price points the analysis is most strongly based on.

The Gross profit breakdown chart shows what overall gross profit is made up of. It starts from the revenue with discounts level, from which discounts and unit costs are deducted. The result is gross profit. The chart helps illustrate how different factors affect gross profit and which items reduce the overall gross profit the most.

The Average margin over time chart shows the development of average margin over selected date range (e.g. past three months). The horizontal axis shows time, and the vertical axis shows average margin. The line illustrates how margin has varied during the review period and whether it has remained stable or changed over time. The chart helps identify periods when margin has been higher or lower than usual, and assess whether the changes may be related to pricing, discounts, or cost variation.

The Unit Margin % development chart shows the percentage development of unit margin over selected date range (e.g. past three months). The horizontal axis shows time, and the vertical axis shows unit margin %. The light blue line represents the unit margin level during the review period. The dark blue line shows the margin target level, but in this case the target appears to be at zero, meaning that no separate margin target has effectively been set. The chart can be used to monitor whether unit margin remains stable and whether any changes can be seen over time.

The Profit over time chart shows the development of profit over selected date range (e.g. past three months). The horizontal axis shows time, and the vertical axis shows profit. The bars represent profit at different points in time and illustrate how profitability has varied during the review period. The chart helps identify periods when profit has been higher or lower than usual, and assess whether profit has remained stable or whether clear changes, outliers, or trends can be seen.

Price simulator graphs and charts

The table compares the impact of the different pricing scenarios you created on profitability and sales. In this example, Baseline represents the current situation with no changes. +10% and -10% show how increasing or decreasing prices would affect gross profit, sales, units sold, and gross margin. “Profit maximization” represents the pricing scenario recommended by the profit optimization model, where gross profit is expected to be the highest.

The following charts compare the impact of different pricing scenarios on key business metrics.

Cumulative Profit Forecast shows how different pricing scenarios affect forecasted cumulative profit. It helps identify which scenario generates the highest profit compared with the current situation.

Cumulative Revenue Forecast shows the impact of different scenarios on forecasted cumulative revenue. The chart helps assess which pricing approach would result in higher or lower revenue according to the forecast.

Cumulative Volume Forecast shows how different pricing scenarios affect forecasted sales volume, meaning the number of units sold. A price increase may increase revenue and profit even if sales volume decreases slightly.

Gross margin % shows the impact of different scenarios on gross margin percentage. Gross margin percentage indicates what share of sales remains as margin after costs.

The Daily Profit Forecast chart shows the daily profit forecast under different pricing scenarios. The horizontal axis shows time, and the vertical axis shows daily profit. The different colored lines represent different scenarios: Baseline, meaning the current situation with no changes; +10% price increase; -10% price decrease; and the Profit maximization scenario.

The chart can be used to compare how different pricing options would affect daily profitability. It helps identify which scenario produces the highest forecasted profit and how profit varies from day to day.

The Daily Revenue Forecast chart shows the daily revenue forecast under different pricing scenarios. The horizontal axis shows time, and the vertical axis shows revenue. The different colored lines represent different scenarios: Baseline, meaning the current situation with no changes; +10% price increase; -10% price decrease; and the Profit maximization scenario.

The chart can be used to compare how different pricing options would affect daily revenue. It helps identify which scenario produces the highest forecasted revenue and how revenue varies from day to day.

The Daily Volume Forecast chart shows the daily sales volume forecast under different pricing scenarios. The horizontal axis shows time, and the vertical axis shows units sold. The different colored lines represent different scenarios: Baseline, meaning the current situation with no changes; +10% price increase; -10% price decrease; and the Profit maximization scenario.

The chart can be used to compare how different pricing options would affect daily sales volume. It helps identify in which scenario forecasted sales volume would be higher or lower, and how sales volume varies from day to day.

Safeguards

Pricing safeguards define the boundaries within which the simulation can suggest price changes. They ensure that prices do not drop too low or rise too high, even if the model recommends a change based on revenue, demand, or profitability.

Examples of safeguards include a price floor and a price ceiling. A price floor prevents a product from being sold at a too low price point or at a level that could put profitability at risk. A price ceiling, on the other hand, prevents the price from rising too high, helping to protect competitiveness, customer experience, and brand perception.

A safeguard is typically defined through three selections: operator, base value, and modifier. Operator determines whether the safeguard is a lower or upper price limit. Base value defines what the limit is based on, such as the current price, product information, or market data. Modifier defines how the limit is adjusted, for example with a fixed value or a percentage.

The safeguard value can also be defined as either a static value or a dynamic value. A static value means a fixed value that remains the same regardless of changes in the product or market. A dynamic value, on the other hand, is based on a selected changing value, such as the product price or a competitor price, meaning the safeguard can update as the underlying data changes.

Safeguards allow pricing to be optimized in a controlled way: the simulation can search for the best possible price level, but only within predefined boundaries. This helps combine revenue maximization, margin protection, and consistent pricing.

Terms:

Price floor = minimum allowed price

Price ceiling = maximum allowed price

Safeguards = pricing safeguards / pricing boundaries

Static value = fixed value

Dynamic value = dynamic / changing value