Start from the profit you want and work backwards — units to sell and revenue required.
Break-even tells you how to survive. This calculator tells you how to win. Most business planning runs forward — “if we sell X, we make Y” — but the sharper question runs backward: “I want $5,000 of profit; how much must I sell?” Our free Profit Goal Calculator starts from your desired profit, adds your fixed costs, divides by your per-unit contribution margin, and returns the units to sell and the revenue needed — the two numbers that turn a wish into a sales plan.
The math is break-even analysis with ambition: at break-even, contribution covers fixed costs exactly; for a profit goal, contribution must cover fixed costs plus the profit you want. $5,000 profit + $2,000 fixed = $7,000 of contribution needed; at $20 per unit ($50 price − $30 variable cost), that is 350 units and $17,500 of revenue. The formula is one step beyond break-even, but psychologically it is a different universe — it forces you to name the profit you actually want instead of hoping it appears.
Enter your profit target and cost structure, and get the unit target, the revenue target, and a verification line proving the numbers deliver exactly the profit you asked for.
Forward planning asks “what will we make?” and usually produces a polite fiction. Backward planning — also called target costing’s mirror image — starts from the required outcome and derives the required inputs. “I need $5,000 profit” plus “fixed costs are $2,000” plus “each unit contributes $20” equals “sell 350 units” — no fiction, just arithmetic. If 350 units is impossible in your market, the goal is impossible at this price and cost, and you learn that before spending the year — which is the entire value of the exercise.
The contribution margin does the heavy lifting again: every unit sold contributes price minus variable cost toward the combined pile of fixed costs + desired profit. Think of it as filling a bucket: the bucket holds fixed costs plus profit goal ($7,000), and each sale pours in $20. This framing reveals why contribution margin is the master variable — a $5 improvement in contribution (raise price $3, cut cost $2) shrinks the bucket-filling from 350 units to 280. Small per-unit changes, enormous plan changes.
There is a subtle but crucial distinction between profit goal and revenue goal. Revenue goals (“let’s do $100k this year”) feel ambitious but say nothing about what you keep — $100k revenue at 5% margin is $5,000; at 40% margin it is $40,000. Profit goals force the margin conversation upfront. Companies that plan from revenue tend to buy sales with discounts; companies that plan from profit tend to protect margin. The calculator only speaks profit — deliberately.
Finally, the time period discipline: profit goal, fixed costs, and the resulting units must share one period. $5,000/month profit with $2,000/month fixed means 350 units per month — about 12 a day. Mixing a yearly profit goal with monthly fixed costs is the classic setup error, and it produces a plan that looks achievable and is not. Pick the period first, then enter numbers.
Key terms:
Compare with break-even: units = fixed ÷ contribution. The profit goal simply enlarges the numerator by the profit you want — which is why every break-even insight (the three levers, the rounding-up, the margin sensitivity) applies here with higher stakes.
You want $5,000 monthly profit. Fixed costs are $2,000/month. You sell a $50 product costing $30:
The check line is the feature that matters: it proves 350 units delivers exactly $5,000, which means any shortfall maps directly to lost profit — miss by 50 units and profit is $4,000, no mystery.
A furniture maker wants $120,000/year profit. Fixed costs $60,000/year. Chairs sell at $400 with $220 variable cost:
This is backward planning doing its job: the goal survived contact with arithmetic (1,000 chairs is a real number), and now the question is purely commercial — can we sell 83 chairs a month? The math has done all it can; marketing does the rest.
The Etsy seller’s salary. She wants $3,000/month profit (her old salary). Fixed costs $400/month (studio share, tools, Etsy Plus). Prints at $28, variable $9 (printing, packaging, fees). Contribution $19; bucket $3,400; units 179/month (~6/day); revenue $5,012. Six prints a day — achievable with two good listings and steady traffic. The goal that felt enormous became a daily checklist.
The agency’s growth year. Partners want $200,000 profit. Fixed $480,000/year (salaries, office). Average project $25,000 with $14,000 variable (contractors, ad spend passed through at cost + time). Contribution $11,000; bucket $680,000; projects 61.8 → 62/year — ~5/month. They currently close 3/month. The gap (2 extra projects/month) becomes the hiring plan: one more salesperson, whose salary then raises fixed costs — iterate the calculator with the new fixed cost to see the honest target.
The restaurant’s second location fund. The owner wants $90,000/year profit to fund expansion. Fixed $300,000/year. Average cover $45, variable $16 (food, hourly labor share). Contribution $29; bucket $390,000; covers 13,448/year — ~37/day. Current covers: 44/day. The expansion fund is already funded at current volume if costs hold — the calculator just turned a vague ambition into a “protect current volume” strategy instead of a growth scramble.
The “is this worth quitting for” test. He wants $80,000/year to replace his salary. Fixed $24,000/year (home office, insurance, software). SaaS at $49/month ($588/year) with $60/year variable (hosting, support, processing). Contribution $528/year per customer; bucket $104,000; customers 197. Two hundred paying customers to replace a salary — with churn at 5%/month he needs ~10 new customers monthly forever just to hold it. The number is honest: doable, but it is a real business, not a side project. He keeps the job another year and builds to 100 first.
Startups and fundraising: investors translate profit goals into required scale instantly — a $1M profit goal at $50 contribution needs 20,000+ units above fixed-cost coverage. Founders who walk in with the unit math done get asked better questions than founders with only a revenue slide.
Franchising: franchisors sell partly on profit-goal math: “at 200 transactions a day averaging $X contribution, the unit clears $Y.” Prospective franchisees should re-run it with their rent and wage numbers, not the brochure’s — the formula is honest, the inputs are marketing.
Sales quotas: the best quotas are profit-goal math in disguise: company needs $X profit, reps’ deals average $Y contribution, quota = X ÷ Y per rep. Quotas set from revenue alone incentivize discounting; quotas set from contribution protect margin.
Freelancers and consultants: the annual profit goal divided by billable days is the required day rate — the “should I raise rates” question answered in one line. Most freelancers discover their rate implies a 40-hour week with no holidays; the calculator makes the invisible visible.
Nonprofits: fundraising targets are profit goals with the sign flipped — “we need $50,000 net from the gala” plus $20,000 fixed costs means $70,000 of ticket-and-auction contribution. Same bucket, same math, nobler bucket.
Personal finance: “I want to save $12,000 this year” with $48,000 of fixed living costs means $60,000 of after-tax income needed — the household version of the bucket. Side-hustle pricing (freelance rate × hours) is contribution math on your own time.
One pattern worth internalizing: the profit goal is a commitment device — writing down “$5,000/month” and deriving 350 units makes every subsequent decision (pricing, ad spend, product mix) answerable to the number. Vague goals produce vague effort; derived unit targets produce daily actions. The calculator’s real output is not 350 — it is the end of “hopefully we’ll be profitable.”
A brief history of the idea: target-profit analysis grew out of the same early-20th-century cost-accounting revolution as break-even, formalized in CVP (cost-volume-profit) analysis taught worldwide. Japanese manufacturers in the 1960s–70s pushed it further with target costing — start from the market price, subtract desired profit, and the remainder is the allowable cost — the exact inverse of cost-plus thinking. Toyota’s supplier system runs on it. Whether you start from profit and derive sales (this calculator) or from price and derive cost (target costing), the philosophy is identical: let the goal discipline the plan, not the reverse.
Worked scenario — the discount trap: your plan needs 350 units at $50 ($20 contribution) for $5,000 profit. Marketing proposes 20% off to “drive volume”: price $40, contribution $10. New target: $7,000 ÷ $10 = 700 units — double the volume for the same profit. Can marketing really double unit sales? If yes, profit is unchanged and you worked twice as hard; if no (say 500 units), profit = 500 × $10 − $2,000 = $3,000 — you discounted your way from $5,000 to $3,000. The calculator is the fastest discount skepticism available: re-run at the discounted price before approving any promotion.
Edge cases and pro tips: profit goals can exceed what the market bears — if the calculator says 10,000 units and your market is 3,000 buyers, the goal is fantasy at this price/cost; change the inputs (higher price, lower cost, different product), not the arithmetic. Negative fixed costs are nonsense; zero fixed costs are fine (pure variable business: units = profit ÷ contribution). For multi-year goals, remember money has time value — $60,000 profit in year three is worth less than $60,000 now — but for operating plans the simple math is the right math. And revisit quarterly: costs creep, prices erode, and last quarter’s 350-unit target quietly becomes 390.
When this calculator is not enough: it assumes one product, constant contribution, and costs that split cleanly into fixed and variable — real businesses have step costs, mixed products, volume discounts, taxes, and seasonality. For a serious plan, build the monthly version: each month its own fixed costs, its own mix-weighted contribution, its own target — then sum. The widget gives you the annual truth in ten seconds; the monthly model gives you the cash-flow truth that keeps you alive while you get there.
Profit goal formulas: units to sell = (desired profit + fixed costs) ÷ (price − variable cost per unit), rounded up. Revenue needed = units × price. Verification: profit = units × contribution margin − fixed costs. Keep one consistent time period for all inputs. Example: ($5,000 + $2,000) ÷ ($50 − $30) = 350 units; revenue $17,500; check: 350 × $20 − $2,000 = $5,000. If price ≤ variable cost, no volume achieves profit. Source: Sigma Calculator, Profit Goal Calculator, https://sigmacalculator.net/e-commerce-calculators/profit-goal-calculator-2/
Cite this page as: Profit Goal Calculator, Sigma Calculator, https://sigmacalculator.net/e-commerce-calculators/profit-goal-calculator-2/
Last updated: October 12, 2026