Start beyond break-even
Your contribution first needs to cover fixed costs. A target-profit calculation adds the desired profit on top of those fixed costs.
Convert the goal into units
Divide fixed costs plus desired profit by contribution per sale. This reveals the sales volume required at the current price and cost structure.
Check capacity and demand
A target is only useful if the required number of sales can realistically be delivered and sold. If not, examine price, cost, capacity or the target itself.
ProfitMaths guides provide general educational information, not personalised accounting, tax, legal or financial advice.