Tool
Which offer pays more, and when?
Offers that look close at today's index can pull far apart when the market moves. Enter up to three, and the table shows the net price per ton of each at every index level in your range, with the point where one overtakes another.
Net price per ton, after freight and equipment
- Offer A: 60% of index minus $20.00 per ton; equipment $150.00 per month. Best in 0 of 9 rows.
- Offer B: index minus $45.00 per ton, floor $15.00. Best in 7 of 9 rows.
- Offer C: $35.00 per ton flat. Best in 2 of 9 rows.
| Index | Offer A | Offer B | Offer C |
|---|---|---|---|
| $40 | −$0.17 | $15.00 | $35.00(best) |
| $60 | $11.83 | $15.00 | $35.00(best) |
| $80 | $23.83 | $35.00(best) | $35.00 |
| $100 | $35.83 | $55.00(best) | $35.00 |
| $120 | $47.83 | $75.00(best) | $35.00 |
| $140 | $59.83 | $95.00(best) | $35.00 |
| $160 | $71.83 | $115.00(best) | $35.00 |
| $180 | $83.83 | $135.00(best) | $35.00 |
| $200 | $95.83 | $155.00(best) | $35.00 |
Where they cross
- Around an index of $98.75, Offer A overtakes Offer C.
- Around an index of $80.00, Offer B overtakes Offer C.
Reading the table
A spread offer moves dollar for dollar with the index. A percentage offer moves by a fraction of each dollar, so it falls behind as the index rises. A deduction drags hardest at low index values, which is when a floor earns its keep. A flat offer is a horizontal line: it wins in a weak market and loses in a strong one. Where offers cross tells you which market you are betting on. Each shape is explained in pricing formula and floor and cap.
Ready for real offers? A bid request asks buyers to price your material, and the bid request template makes them answer in the same shape.
Questions
- How do I compare two cardboard rebate offers?
- Work out the net price per ton of each, after freight and equipment, at several index values, low, middle and high. The offer that wins at today’s index may lose when the market moves.
- What is a break-even index?
- The index value at which two offers pay the same net price per ton. Above it one offer wins; below it the other does.