Target Profit Sales Calculator

How it is calculated

Each unit sold contributes contribution = price − variable cost toward fixed costs and profit. The units needed are units = (fixed costs + target profit) ÷ contribution, always rounded up to a whole unit, since you cannot sell a fraction. Required revenue is the rounded-up units times the price. All amounts must use the same period (for example one month) and the same currency, and the output is shown in dollars. Fixed costs and target profit cannot be negative, and the price must be higher than the variable cost; if it is not, every extra sale loses money and the tool returns no result. Profit here is before income tax, so add tax separately if your goal is after-tax profit.

Common mistakes

• Using the profit margin or the price instead of the contribution per unit. The divisor is price minus variable cost, not the price alone.
• Putting some fixed costs, such as rent, into the variable cost per unit. That double counts them and inflates the units needed.
• Mixing periods: yearly fixed costs with a monthly profit target gives a meaningless unit count.
• Entering the target as after-tax profit. The formula treats it as pre-tax operating profit, so tax is not accounted for.
• Leaving out variable costs such as shipping, payment fees or commissions, which makes the contribution look bigger than it is.