Free business workshop

Price your work. Understand your profit.

Build a complete cost estimate, test assumptions, and compare with what actually happens.

Follow the pricing lesson and printable activity →

Start with a worked example

Fictional monthly scenarios in USD. Loading an example replaces the current fields, while keeping your saved comparison.

Bakery: a box of cookies

One box sold · 200 sales per month at $18.00 each.

Waste applies to ingredients and production labor. Divide those costs by 0.90 because only 90% of production is sold; simply adding 10% understates the cost per sale.

Variable cost per sale: $9.32, including fees.
Contribution: $18.00 − $9.32 = $8.68.
Monthly profit: contribution × 200 − $400.00 overhead = $1,336.44.

Break-even: 47 whole sales. Calculations use unrounded amounts.

Service: a completed cleaning job

One completed job · 30 sales per month at $150.00 each.

Include travel and preparation in labor minutes and supplies in materials. Unpaid owner time is still work; leaving it out inflates modeled profit.

Variable cost per sale: $87.50, including fees.
Contribution: $150.00 − $87.50 = $62.50.
Monthly profit: contribution × 30 − $600.00 overhead = $1,275.00.

Break-even: 10 whole sales. Calculations use unrounded amounts.

Handmade: a ceramic mug

One mug sold · 100 sales per month at $40.00 each.

A failed firing consumes clay and labor. Keep fixed kiln and studio expenses in overhead; add variable firing costs to materials if applicable. Sales volume remains an assumption.

Variable cost per sale: $22.75, including fees.
Contribution: $40.00 − $22.75 = $17.25.
Monthly profit: contribution × 100 − $300.00 overhead = $1,425.00.

Break-even: 18 whole sales. Calculations use unrounded amounts.

1. Build your monthly estimate

Fictional example in USD. Use one product or service unit and one month throughout. For services, a unit can be one completed job.

Selling price per unit ($)Units sold per monthMaterials per unit produced ($)Packaging per unit sold ($)Labor minutes per unit producedPay for labor ($ / hour)Transaction fee (% of revenue)Fixed monthly overhead ($)Production wasted before sale (%)

Overhead includes website fees, rent, licenses and other fixed costs. Materials and labor include waste; packaging is added only to sold units. Include your own labor. Exclude sales tax collected for government from revenue. This estimates operating profit before income tax, financing and unentered costs.

2. Understand the result

Revenue$2,400.00

Total modeled costs$1,454.46

Operating profit$945.54

Break-even sales49 units / month

Each sale contributes $6.23 after variable costs toward $300.00 of monthly overhead. Sales above break-even begin to earn operating profit in this model.

Revenue: Price × units sold, before expenses.
Profit: Revenue minus all costs entered, including labor and overhead.
Margin: 39.4%: Profit divided by revenue.
Markup on total modeled cost: 65.0%: Profit divided by total modeled cost. This differs from markup on materials alone.

3. Compare prices and sales volumes

These are independent assumptions, not forecasts of customer demand. Changing price does not guarantee a particular sales volume.

Monthly operating profit across price and volume assumptions
Price / sales	150 units	200 units	250 units
$10.80	$460	$713	$966
$12.00	$634	$946	$1,257
$13.20	$809	$1,178	$1,548

4. Save an estimate, then compare actual results

Save your plan before trading. At month end, enter your actual average price, sales and costs above, then compare with the saved estimate. Keep the same product and period. Saving again replaces the previous estimate.

Only Save writes your figures to this browser. Other users of this browser profile can access them. Entries are not uploaded. Review prices against actual customer response and update costs regularly.