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Category Margin Mix Calculator

Work out category margin mix instantly with clear inputs, formula shown and shareable results.

About Category Margin Mix Calculator

Blended margin is total gross profit over total sales, so it moves with mix as well as with individual category margins. Shifting five points of sales mix towards the higher-margin category here changes the blended rate without any price or cost action at all.

Formulas

Blended margin

Blended % = Total gross profit / Total sales x 100

Mix effect

A five-point mix shift changes gross profit by Total sales x 5% x (Margin B - Margin A)

Worked example

With the default values below, Category Margin Mix Calculator returns Blended gross margin of 36.000%. Change any input above and every figure here is recalculated in your browser.

Inputs used

Category A sales
18,000,000
Category A gross margin
28
Category B sales
9,000,000
Category B gross margin
52

Results

Blended gross margin
36.000%
Total gross profit
$9,720,000.00
Share of sales in the higher-margin category
33.33%
Blended margin if mix shifts five points
37.200%

Step by step

  1. 1Values used
  2. 2Blended margin
  3. 3Mix effect
  4. 4Blended gross margin= 36.000
  5. 5Total gross profit= 9,720,000.00
  6. 6Share of sales in the higher-margin category= 33.33
  7. 7Blended margin if mix shifts five points= 37.200

Assumptions and limits

  • The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
  • Figures are rounded for display to 3 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

Why does blended margin fall when sales grow?

Usually because growth is concentrated in a lower-margin category. The mix effect is often larger than any rate change.

How do I separate mix from rate?

Recalculate blended margin holding mix constant at the prior period. The difference from the actual is the mix effect.

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