# Retail price index calculator

Put your selling price on a 100-point scale against one matched competitor price. This page uses your price divided by the competitor's, the index twelfth uses, so a result above 100 means you are priced above the competitor.

Formula: Price index = your price ÷ competitor price × 100.

Example: Your price 20; Competitor price 18.
Result: Price index 111.11.

## How to calculate it

1. Check that the product, variant, pack size, seller and observation date make a fair match.
2. Divide your price by the competitor's price, then multiply by 100. A result of 100 means price parity.
3. Read the gap with category role, margin floor and the duration of the competitor price before proposing a move.

## A matched $18 price against your $20

Your item is $20 and a competitor lists the same item for $18. The index is $20 ÷ $18 × 100 ≈ 111: you are priced about 11% above the competitor.

A 12-pack against your 24-pack fails the match check, and one low price says little about the competitor's position across the whole category. Record the match evidence and compare a consistent basket before changing a price policy.

## Check before acting

- Price-index conventions can run in the opposite direction. State the numerator whenever you share the number.
- Check promotions, shipping, loyalty conditions and pack sizes before treating a gap as comparable.

## Questions

### What does a price index of 111 mean here?

Using your price divided by the competitor's, it means your price is 111% of theirs: you are priced about 11% above them.

### Why do other price-index reports reverse the result?

Some reports divide the competitor's price by yours, so a lower number means the competitor is cheaper. Both conventions can work, but the numerator must be stated so readers know what above or below 100 means.

### Should I match every cheaper competitor price?

No. Check the product match, how long the price lasts, your intended price position and the margin effect before deciding.

[Use the interactive calculator](https://twelfth.ai/tools/price-index).
[Download the price-index CSV template](https://twelfth.ai/resources/retail-csv/price-index.csv).
[Download the eight-tab workbook](https://twelfth.ai/resources/retail-metrics-template.xlsx).
[Read the price-index glossary definition](https://twelfth.ai/glossary/price-index).
Related calculators: [Retail markdown calculator](https://twelfth.ai/tools/markdown), [GMROI calculator for retail inventory](https://twelfth.ai/tools/gmroi).
[See how price intelligence becomes a reviewed decision](https://twelfth.ai/solutions/retail-pricing-intelligence).
Source: https://twelfth.ai/tools/price-index