Understanding the Default Pricing Formula For Matboard

We have designed the default pricing formula to keep you profitable and, at the same time, price competitive.

You can be assured that at least half the Cost of the mat is covered, regardless of the size you actually cut.
Your less expensive matboards have a higher markup and the expensive ones have a lower markup; automatically.
See also: Pricing Options and Defaults for Matboard

How the Retail Price of a Matboard is Calculated

The core of FrameReady's default Formula for matboard pricing is this:

Retail Price = (Wholesale Cost x Markup) + Set Price
This default formula is applied to all matboard, regardless of the board size, e.g. 32x40, 40x60.
For example, a 32x40 mat is $6.49, multiplied by a Markup of 4, equals $25.96 plus a one time Set Price of $5. The final Retail Price is $30.96 for the entire matboard.

Wholesale Cost	Less Than	Markup
Cost	<6	4.00
Cost	<8	3.95
Cost	<10	3.90
Cost	<12	3.85

Markup Calculation

The Markup is determined by the wholesale Cost and is set on a sliding scale: as the cost of the matboard increases, the Markup decreases.
FrameReady has a unique sliding scale formula built-in. This formula lowers the Markup as the wholesale Cost of the mat goes up, preventing expensive mats from going through the roof. At a glance, that formula looks something like this:
The first line is the word "Case" -- this means "in the case that..." and basically tells FrameReady that we want to do a series of tests. We want to test the wholesale Coast and find the highest dollar number that it falls under.
The lines below the "Case" statement are each individual tests, followed by the result, if the test is true.
So when we see "Cost<6; 4;" then we can read it "If the wholesale cost is less than $6, then the result we want to use is 4"
The "Case" test keeps going down the lines until it fails, then it uses the last successful result. And that's how FrameReady determines which Markup to use.
Remember, we want matboards with low wholesale costs to have a higher markup. And we want more expensive mats to be more reasonably priced. The markup increases in small increments of 0.05 per level. When markups increase by large increments, it is possible that you will pay more for the mat and receive less profit on it, if the markup changes by more than 0.05.

Note: When Markups in your Formula increase by large increments, then is it possible you will pay more for the mat when the Cost increases and receive less profit for it when the Markup decreases more than $0.05.

Set Price Calculation

The Set Price is an amount which is automatically added to the retail price of the matboard, regardless of the size being sold.
The FrameReady default for Set Price calculates half the wholesale cost of the matboard, rounded up to the nearest dime. For example, if the wholesale Cost is $10.83, then the Set Price will be $5.40.
The formula for this calculation is: Round( Cost / 2;1 )
By using this Formula (instead of just a fixed number) you can be assured that at least half the Cost of the mat is covered, regardless of the size. And the Set Price will always increase whenever a vendor price update is performed.
The default formula is applied to all matboard regardless of the board size, e.g. 32×40, 40×60.

You may also chose to apply a Set Price based on Supplier to cover shipping costs. See: Set up your Set Price

Minimum Price Calculation

The Min Price field is used to set a minimum dollar amount for the Retail Price of the matboard. The Retail Price will never fall below the amount in the field.
By entering the keyword “Cost“, the amount is based on the wholesale Cost of the mat. In the example below, the Cost of the mat is $6.18.
The Retail Price of the mat remains the same -- until it reaches the point where the Retail Price surpasses $6.18. At that point, the Retail Price increases as per the calculations of the Markup and Set Price.

The Code Table pricing option is not used in the FrameReady default pricing of matboard.

The default formula is applied to all matboard regardless of the board size, e.g. 32×40, 40×60.
The default Formula for matboard pricing does not include a Minimum Price.

Watch the Markup and Set Price in Action

To understand a bit more of the formula, let's look at the Markup and Set Price in action (this is an older video, so FrameReady may look dated) and see how a Markup affects the retail price of large pieces and how the Set Price affects the retail price of small pieces.