I was watching a video where I heard that if your profit is 10% and you increase your price by 10%, then your profit goes to 20%, which is basically double.

I ran some basic math on this to make it clearer for myself:

Let’s say revenue = $1M

Profit margin = 10%, so profit = $100K

Costs = $900K

If you increase the price by 10%

New revenue = $1.1M

Costs stay the same = $900K

New profit = $200K

So profit went from $100K to $200K. That is 2X.

Then I asked AI to give me a formula that can work for other profit ranges as well.
If your profit margin is P%, then a (P ÷ (100 – P))% price increase doubles your profit.

At 10% profit → 11.1% price increase doubles profit. (10 ÷ 90 = 11%)
At 20% profit → 25% increase doubles profit. (20 ÷ 80 = 25%)
At 30% profit → 43% increase doubles profit. (30 ÷ 70 = 43%)

Of course, in real life, if the price goes up, the close rate may go down, which can impact the numbers above. Still, I think it’s useful to know these numbers regardless.