DISCLAIMER: I am NOT a financial advisor, certified professional or authority. The provided information is based off of personal experience only. Please consult with a financial professional or certified tax professional. Actions are taken at your own risk and expense.
✨ OPTIONAL ✨ Use the table below to start calculating your profit margins per/each offer and product.
✏️ (You can come back to this step once you know your offers). You can do it per/product or per/category (i.e. “5.5in Stickers = $4” or “Design Name Sticker = 4” etc.
✨ Here is a free profit margin calculator if you don’t love numbers! ✨
Psst…Right now this table is setup to just calculate your estimates (or actuals) of each of your products/offers. BUT you can choose to use this to track all your income/sales/expenses. If you do, I would duplicate this table so you have a “birds eye view” of each of your offers and break up your sales/expenses per business quarter to keep things clean.
Profit Margin Estimates & Actuals for My Offers 🪄
Revenue = The TOTAL amount of money you make (in a given period of time) via your offers/products/sales.
Cost of Goods Sold (COGS) = Total expenses for creating and selling your product/offer.
Profit = (Revenue - COGS) = Your Profit #
Profit Margin = (Profit / Revenue) x 100 = %
This comes down to personal opinion. Per product I consider 50% a non-negotiable minimum. Why? Well, there is a difference between direct expenses and non-direct. It’s the small detail we don’t think about…
Non Direct: General business overhead (subscriptions), gas for car to get to a market…etc.
Direct: The literal cost of the product (seen above on the table, which this example doesn’t include taxes, see below).
Great question. You have two options here - some people prefer to calculate the tax % from their profit before calculating their profit margin. This would be a nice way to get a CLEAN view of what you are truly making per sale. For this birds eye view above, do it! (Remember, we’re just trying to get down per/offer, not EVERYTHING)
Option 2: Because I have so many products AND services AND offers, I calculate out my tax % per/month (then per/quarter) based on my overall income. For me, it’s easier! BUT having this high-level is 100% important. This helps you run sales and discounts with more peace of mind. I’ve seen creatives run a 25% sale and kill their profit margin entirely because of taxes.