Product Profitability Analy

Instructions:

1. Enter Product Name, Price, and Unit Cost in the Product Profitability Analysis tab at the bottom of this spreadsheet.
2. Enter Unit Sales Revenues and Cost of Goods Sold for each product line. (Gross Contribution will be automatically calculated)
3. Determine Product Marketing Costs for each product line and enter into Marketing Costs column.
4. Edit formulas in Sales Costs columns to reflect the actual commission percentages paid to sales representatives.
5. Evaluate Product Profit/Loss and Gross Margin for each product line. (Automatically calculated)
6. Open the Product Charts tab to view data in a graphical format.
7. Assess which products are most profitable and determine how to increase profitability for poor margin products.
oduct Profitability Analysis Template
 Product Profitability Analysis Template

Product Name Price Unit Cost Unit Sales Revenues COGS* Gross Contribution Marketing Costs Sales Costs** Product Profit/Loss Gross Margin
Product 1 $1,000 $240 890 $890,000 $213,600 $676,400 $45,600 $89,000 $541,800 60.9%
Product 2 $5,000 $2,400 213 $1,065,000 $511,200 $553,800 $69,900 $106,500 $377,400 35.4%
Product 3 $25,000 $10,000 97 $2,425,000 $970,000 $1,455,000 $29,750 $194,000 $1,231,250 50.8%
Product 4 $50,000 $34,000 35 $1,750,000 $1,190,000 $560,000 $9,500 $140,000 $410,500 23.5%
Product 5 $250,000 $190,000 12 $3,000,000 $2,280,000 $720,000 $123,450 $90,000 $506,550 16.9%

* COGS - Cost of Goods Sold before Sales & Marketing costs.

** Sales Costs - formulas need to be updated to reflect your sales commission percentages.
$3,500,000

$3,000,000

$2,500,000 Product 5

$2,000,000 Product 4
Revenues
Gross Contribution
$1,500,000 Product 3
Profit/Loss
$1,000,000
Product 2
$500,000
Product 1
$0
Product 1 Product 2 Product 3 Product 4 Product 5 0.0% 10.0

$250,000

$200,000
Product 5

$150,000 Product 4
Sales Costs
$100,000 Marketing Costs Product 3

Product 2
$50,000
Product 1
$0
Product 1 Product 2 Product 3 Product 4 Product 5 0 100
 Gross Margin
Product 5

Product 4
Gross Margin
Product 3

Product 2

Product 1

0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0%

Unit Sales
Product 5

Product 4
Unit Sales
Product 3

Product 2

Product 1

0 100 200 300 400 500 600 700 800 900 1000