Floor price enforcement: how to stop selling below cost before it shows up in your P&L
Most brands discover floor-price breaches in the monthly reconciliation. By then, the damage is done. Here is how to catch them in real time.
Key takeaways
- →Platform-funded discounts compound with brand-funded discounts multiplicatively, not additively — a 10% brand discount plus a 10% platform top-up produces an 19% effective discount, not 20%.
- →43% of brands in our dataset had at least one SKU selling below floor price in Q4 2025 without knowing it.
- →The most common cause is a stale floor price that has not been updated after a COGS increase.
- →MIRA's simulation tool runs the full P&L before you publish a price — not after.
How floor-price breaches happen
A floor price is the lowest price at which a brand will sell a SKU and still achieve a target gross margin. In theory, this is simple: set the floor, enforce it. In practice, three things make it hard:
1. Discount compounding
Brand-funded discounts and platform-funded top-ups compound multiplicatively. If you offer a 10% brand discount and Blinkit adds a 10% platform top-up, the customer sees an 19% discount — not 20%. The formula is:
effective_discount = 1 - (1 - brand_discount) × (1 - platform_topup)
Most manual models add these discounts, which overstates the selling price and understates the margin impact.
2. Stale floor prices
COGS change. Fulfillment costs change. Commission structures change (see: Blinkit Q1 2026). A floor price set in October 2025 may no longer reflect the actual cost structure in April 2026. Without a system that recomputes the floor from current inputs, the floor price becomes a stale number that gives false confidence.
3. Multi-currency confusion
For brands selling across India and international markets, COGS in INR and selling prices in AED or USD must be compared at the exchange rate on the observation date — not at a fixed rate set at budget time. A floor price that was safe at 93 INR/AED may be below cost at 97 INR/AED.
What MIRA does
MIRA's margin engine recomputes the full P&L for every price scenario before you publish it. The simulation catches floor breaches before they happen. The daily brief flags any SKU where today's effective selling price — after all discounts — is below the floor computed from current COGS and fees.
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