All Industries, Financial Model, General Excel Financial Models

Excel, Financial Model, Financial Modeling, Pricing, Private Equity Waterfall Distribution Models, Variance Analysis

Price-volume-mix analysis is vital in understanding the changes in sales and profits between two periods, between budget and actual or between model scenarios.

This comprehensive full-scope model allows to:

Compare total prices, volumes, revenues, and gross profit by product between two periods.
Figure out which products experienced the highest price, volume, revenue, and profit changes, both positive and negative.
Visualize mix changes by products and by periods
Determine which products affected the change in revenues (profits) and to what extent
Build revenue and gross profit bridges for a particular product
Split the revenue and gross profit changes into three components: price effect, mix effect, and volume effect
Calculate price-volume correlations

The model handles ten products and five annual periods (which can be amended to your requirements rather quickly). Every sheet allows selecting periods for the analysis independently from other sheets. You will most probably want to compare two consecutive periods, but those can really be any two periods you choose.

The model uses professionally designed magazine-quality charts and mini-dashboards. Some of them are custom-built. For instance, waterfall charts are great to visualize the effect of every product on the change between two years’ revenues.

Excel has a standard vertical waterfall chart, which I find rather bulky. Instead, I use more compact and elegant horizontal waterfall charts. Unlike a vertical waterfall chart, my chart is compatible with all versions of Excel.

Another type of chart is a ‘broken line’ (or ‘stepped line’) chart which also looks smarter than a regular line chart. To make sure you can update/create new such charts, I am providing detailed appendices with full instructions. Use them in your models and presentations to impress your clients, managers, and colleagues!

Another feature of this model is the use of form controls (checkboxes, list boxes, drop-down lists) to quickly select periods and products. Such controls add interactivity to your files and make them more professional and user-friendly.

There is also an appendix to the file with instructions on those. The model contains 18 worksheets and uses no macros.

It is accompanied by a detailed text guide. You will get a full Excel Template (.xlsx) and a Model Explainer PDF (.pdf)