Work out index linked price adjustment instantly with clear inputs, formula shown and shareable results.
Partial pass-through shares input cost risk between buyer and supplier: an 80% factor means the supplier absorbs a fifth of any index movement. That retained exposure is what preserves the supplier's incentive to hedge and to source efficiently.
Index movement
Movement % = (Current index / Base index - 1) x 100
Adjusted price
Adjusted = Base price x (1 + Movement x Pass-through %)
Indicative estimate only. Fees, entitlements, limits and formulas vary by jurisdiction, statute, policy wording and the facts of the case. This is not legal, tax, insurance or financial advice — confirm with a qualified professional or the relevant authority.
Because full pass-through removes the supplier's incentive to manage input cost. Retaining 10-25% keeps them engaged in hedging and substitution.
Quarterly is common. Monthly creates administrative noise; annually creates large steps and cash flow strain for the supplier.