Part 2. MM4XL Tools > 2. Analytical Tools > Business Formulas > mmPRESS, Product Performance Index

Business Formulas

mmPRESS, Product Performance Index

Category: Reporting > Metrics

The PRESS Product Performance Index is a basic ROI (Return on Investment) model based on the relationship between product contribution and resource used. PRESS was first developed by Hamelman and Mazze (1972) under the name Selection Index (SIN).

Business analysis formulas for Excel. Marketing tool for professionals

Armstrong (1973) refined the index, and called it Direct Index (DIR), to handle the case of negative contribution margins, which the Hamelman and Mazze index fails to do.

Business analysis formulas for Excel. Marketing tool for professionals

Where:

SIN = Selection Index
DIR = Direct Index
CMi = Contribution margin for product i
FCi = Facility costs for product i

Syntax

mmPRESS(Contribution_Margin, Facility_Cost, Optional Squared_Index)

Contribution_Margin The brand or project percent contribution margin
Facility_Cost The percent fixed costs attributed to the brand or project
Squared_Index Optional - TRUE returns the SIN index, FALSE returns the DIR index

Example

See example file Business Formulas.xls, sheet mmPRESS.

Business analysis formulas for Excel. Marketing tool for professionals

Note: This is an Array Function (curly brackets { } ). To enter an array function: (1) select the range where you want to enter it, for instance, D13:D18; (2) type the formula; (3) press CTRL+SHIFT+ENTER.

Related functions
  • mmBASS
  • mmBDI
  • mmBEI
  • mmBEP
  • mmBEPR
  • mmBUYRATE
  • mmCDI
  • mmHERF
  • mmMOI
  • mmMSAR
  • mmPERFCV
  • mmPERFO
  • mmPERFR
  • mmPREMIUM
  • mmREBUY
  • mmREBUYS
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Source
Yoram J. Wind, 1982, Product Policy: Concepts, Methods, and Strategy
Lifetime license:

Price: euro

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