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Product Profitability Analysis Template

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Product Profitability Analysis Template Powered By Docstoc
					This Product Profitability Analysis Template reveals each product's contribution margin
for a company's portfolio of products. The product contribution margins enable the
company to see how much any product contributes to its bottom line over time, while
also quantifying the cost drivers for each product's profitability. By using this template, a
company can identify which of its products are the most profitable. This document
should be used by business managers or other officers of a product manufacturing
company.
Table of Contents

1    Product Name ..................................................................................................................... 3

2    Price & Unit Cost ................................................................................................................. 3

3    Revenue............................................................................................................................... 3

4    Product Profit/Loss .............................................................................................................. 3

5    Gross Margin/Product Profitablity Analysis ........................................................................ 4




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1       Product Name
(Instruction: Please list the products for which the profitability analysis has to be done. For
example, products A, B, C, D and E)

2       Price & Unit Cost
(Instruction: Include the price of the product here)

    S.#     Product Name              Unit Cost                    Price
    1       Product A                 $200                         $1,000
    2       Product B                 $800                         $2,000
    3       Product C                 $850                         $2,000
    4       Product D                 $1,200                       $4,000
    5       Product E                 $100                         $1,200



3       Revenue
    S.#     Product Name        Unit Sales (A)         Price (B)            Revenue
                                                                            C = (A x B)
    1       Product A           100                    $1,000               $100,000
    2       Product B           200                    $2,000               $400,000
    3       Product C           180                    $2,000               $360,000
    4       Product D           100                    $4,000               $400,000
    5       Product E           200                    $1,200               $240,000



4       Product Profit/Loss
                          Gross               Marketing                               Product
 Revenues       COGS*                                             Sales Costs**
                          Contribution        Costs                                   Profit/Loss
 $100,000    $20,000      $80,000             $45,600             $10,000             $24,400
 $400,000    $160,000     $240,000            $69,900             $40,000             $130,100
 $360,000    $153,000     $207,000            $29,750             $28,800             $148,450
 $400,000    $120,000     $280,000            $9,500              $32,000             $238,500
 $240,000    $20,000      $220,000            $123,450            $7,200              $89,350
* COGS - Cost of goods sold before sales & marketing costs (Unit Cost x Unit Sales)

** Sales Costs - Formulas need to be updated to reflect your sales commission percentages.

© Copyright 2011 Docstoc Inc.                                                                3
5       Gross Margin/Product Profitablity Analysis
    S.#     Product Name        Revenue       Product       Gross Margin
                                              Profit/Loss
    1       Product A           $100,000      $24,400       24.4%
    2       Product B           $400,000      $130,100      32.5%
    3       Product C           $360,000      $148,450      41.2%
    4       Product D           $400,000      $238,500      59.6%
    5       Product E           $240,000      $89,350       37.2%




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Description: This Product Profitability Analysis Template reveals each product's contribution margin for a company's portfolio of products. The product contribution margins enable the company to see how much any product contributes to its bottom line over time, while also quantifying the cost drivers for each product's profitability. By using this template, a company can identify which of its products are the most profitable. This document should be used by business managers or other officers of a product manufacturing company.