Enter the daily profit ($) and the daily costs ($) into the calculator to determine the Monthly Revenue.
Related Calculators
- Total Price Calculator
- Close Rate Calculator
- Business Profitability Calculator
- Price Adjustment Calculator
- All Business Calculators
Revenue and Profit Formula
The calculator uses three formulas, one for each tab.
Revenue minus Costs:
Profit = Revenue - Total Costs
Units and Costs:
Profit = (Units * Price) - (Units * Variable Cost + Fixed Costs)
Target Profit:
Units Needed = (Fixed Costs + Target Profit) / (Price - Variable Cost)
Variables:
- Revenue: total money taken in before costs
- Total Costs: every cost tied to that revenue (fixed plus variable)
- Units: number of items sold in the period
- Price: selling price per unit
- Variable Cost: cost that scales with each unit sold
- Fixed Costs: costs that stay flat regardless of unit volume (rent, salaries, software)
- Target Profit: the profit number you want to hit
- Profit Margin: profit divided by revenue, shown as a percent
- Contribution per Unit: price minus variable cost
The first tab handles the simple case where you already know revenue and total costs. The second tab builds revenue and costs up from unit economics and also returns break-even units. The third tab works backwards from a profit goal and tells you how many units you need to sell.
Reference Tables
Use these as rough benchmarks when judging your output. Industry numbers vary, so treat them as ranges, not rules.
| Industry | Typical Net Margin | Typical Gross Margin |
|---|---|---|
| Grocery / Retail | 2% – 4% | 20% – 30% |
| Restaurants | 3% – 9% | 60% – 70% |
| Construction | 5% – 8% | 15% – 25% |
| Professional Services | 10% – 20% | 40% – 60% |
| SaaS / Software | 15% – 25% | 70% – 85% |
| E-commerce | 5% – 12% | 30% – 50% |
| Cost Type | Examples | Goes In |
|---|---|---|
| Fixed | Rent, salaries, insurance, software subscriptions | Fixed Costs field |
| Variable | Materials, packaging, payment processing, shipping | Variable Cost per Unit field |
| Semi-variable | Utilities, hourly labor | Split between both, or estimate the variable portion |
Example Problems
Example 1: Quick check. A shop pulled in $25,000 in revenue last month with $18,000 in total costs. Profit is $25,000 – $18,000 = $7,000. Profit margin is $7,000 / $25,000 = 28%.
Example 2: Target profit. You sell a product for $35 with $18 in variable costs and $7,500 in monthly fixed costs. You want $10,000 in monthly profit. Contribution per unit is $35 – $18 = $17. Units needed = ($7,500 + $10,000) / $17 = 1,030 units. Round up to 1,030 whole units to hit the goal.
FAQ
What is the difference between revenue and profit? Revenue is the gross amount you collect from sales. Profit is what is left after you subtract every cost.
Should I include taxes in costs? If you want net profit, yes. If you want operating profit, leave income tax out and include only operating costs.
Why does the break-even line say “not possible”? That happens when your variable cost per unit is equal to or higher than your selling price. Each sale loses money, so no number of units covers the fixed costs.
How do I handle a service business with no units? Use the Revenue minus Costs tab. Or treat billable hours, projects, or clients as your “units” in the second tab.
