Service offer margin check
A small team expects $12,000 in monthly revenue, $4,200 in direct delivery cost and $2,100 in overhead.
- Revenue: $12,000
- Direct costs: $4,200
- Operating costs: $2,100
Business basics
Profit Margin Calculator
Estimate gross profit, net profit and operating margin from revenue and cost inputs.
How to use this calculator
Start with conservative inputs, copy the result, then test a best-case and worst-case version. For production decisions, compare the estimate against actual accounting, analytics and payment data.
Formula
Profit margin shows how much revenue remains after direct costs and operating costs. Use gross profit to understand delivery economics, then use net margin to decide whether the offer can support overhead and growth.
Formula
Net profit = revenue - direct costs - operating costs. Net margin = net profit / revenue.
Example
FAQ
What is a good profit margin?
It depends on the business model. Software and digital products can support higher margins, while services, ecommerce and marketplaces often have more delivery cost. Compare the result against your own cost structure instead of using one universal benchmark.
Should taxes be included?
Use this calculator for planning before tax. Add tax, payment fees, refunds and accounting adjustments separately before making financial decisions.
What is the difference between gross and net profit?
Gross profit subtracts direct delivery costs from revenue. Net profit also subtracts operating costs such as software, admin, support and overhead.
Important limits
- This is a planning estimate, not accounting, tax or investment advice.
- Currency, tax, refunds and payment fees can materially change the final margin.