Support for Microsoft Growth Margin

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❗ Important: This feature is currently in Early Availability (EA) status. For more information on feature status, see Product lifecycle phases.

Microsoft is introducing Growth Margins from 1 October 2026. These are additional margins Microsoft awards partners when a transaction qualifies, resulting in a higher margin than the standard base rate. Growth Margin affects what the partner pays Microsoft. It does not automatically change the customer's price.

This release adds marketplace support so that sales teams can see when a deal is eligible for Growth Margin before the transaction is committed. Microsoft checks eligibility against the customer's Microsoft account (tenant), including purchases made outside the marketplace.

How does a transaction qualify?

Microsoft evaluates Growth Margin eligibility under different scenarios. Examples include:

• New to offer — The customer has not had the eligible product on their tenant within the look back period (3 years by default).
• Seat expansion — New seats can earn Growth Margin if they meet Microsoft's minimum. Existing and new seats can qualify together only at renewal.
• Strategic SKU mix — The customer increases use of a target product relative to related products they already have.

📝 Note: Growth Margin is locked at the point of sale. If a transaction should have qualified but wasn't flagged in time, no retroactive adjustment is made. Unqualified deals proceed at the standard base margin and are not blocked.

Marketplace behavior

Behavior depends on the marketplace pricing model.

Marketplaces that price from Microsoft's suggested retail price (markdown)

The customer sale price does not change. On quotes, Marketplace Managers and Sales Support Representatives can see a read-only Growth Margin eligibility indicator when a deal qualifies, and can adjust the sale price to set what the customer pays.

Marketplaces that price from vendor cost (Cost+)

When a deal qualifies, the platform uses the lower Growth Margin vendor cost in the Cost+ quote calculation. The sales agent still sets the final sale price.

📝 Note: This behavior may roll out in the weeks following the initial eligibility indicator launch. Contact your AppDirect technical representative for your marketplace timeline.

Prerequisites

• The customer must have a linked Microsoft tenant. Without one, no eligibility check runs and no indicator appears.
• A vendor share must be configured on the product. Where Microsoft products are set up as first-party products with a 0% vendor share, Growth Margin cannot be calculated. Partners using the network catalog for Microsoft are unaffected.

Feature enablement

This feature is not enabled by default. Contact your AppDirect technical representative to request it.

Setting enablement

No additional setting enablement is required in this release. Growth Margin is enabled per marketplace by AppDirect.

Documentation

Documentation will be updated with the release. For Microsoft programme details, see Growth margins.