166.6667 is the example result. Read it using the units and relationship stated below.
Minimum Order Value uses fixed order cost, target contribution margin (%).
Protecting contribution before accepting a price
For minimum order value, the relationship is Result = (([Fixed order cost]) ÷ ([Target contribution margin (%)] ÷ 100)). The amount depends on the supplied fixed order cost, target contribution margin (%), rather than a live market price or a value imported from another record. A quote can meet a revenue target and still leave too little to cover delivery. Separate the selling-price denominator from the cost denominator: margin and markup answer different questions. A discount changes contribution even when the supplier cost stays fixed.
What the model includes
Result = (([Fixed order cost]) ÷ ([Target contribution margin (%)] ÷ 100)) A pricing review should retain the supplier cost, sale price and the reason for any allowance. Returns, payment charges, delivery and tax require explicit treatment; they should not disappear inside a percentage labelled profit. Compare the proposed price with the customer agreement and delivery capacity. A mathematically achievable margin does not establish that buyers will accept the offer.
Example with the supplied inputs
Fixed order cost: 50; Target contribution margin (%): 30. Result: 166.6667. The values are illustrative.
Compare one changed input
Fixed order cost changes from 50 to 55. The result becomes 183.3333. All other inputs remain fixed.
Calculation rule
Result = (([Fixed order cost]) ÷ ([Target contribution margin (%)] ÷ 100))
Inputs and output
| Input | Example value | Entry convention |
|---|---|---|
| Fixed order cost | 50 | Use fixed order cost on the currency and period basis shown by the formula. Keep gross amounts, net amounts and unit amounts distinct; the page does not fetch a price or exchange rate. |
| Target contribution margin (%) | 30 | Enter target contribution margin (%) on the percentage scale used in the formula (20 means 20%, not 0.20). Keep its base and reporting period consistent with the other inputs. |
Output: 166.6667 is the example result. Read it using the units and relationship stated below. Use the formula to distinguish a cash amount, count, percentage or ratio.
How to use the page
Collect the inputs
Gather Fixed order cost, Target contribution margin (%). Use one period and the units shown in the form.
Run the calculation
Enter the values and select the action. The calculation rule above explains how the inputs produce the result.
Compare a scenario
Change Fixed order cost on its own, keeping the other inputs fixed. Read both results before changing another assumption.
Worked example
With the example inputs listed above, the result is 166.6667.
Change Fixed order cost from 50 to 55 while keeping every other value fixed. The result becomes 183.3333. This comparison isolates that input; it does not forecast how other variables will respond.
Check the stated formula, units and limits before using the result in a decision.
Keep the displayed formula, input units and model scope with the result. Corrections or questions can be sent through the request section on this page.
Content updated: October 11, 2026