Target Profit Calculator

Use this calculator to estimate how many units you need to sell to reach a target profit.

What this calculator does

The target profit calculator shows how many units must be sold to cover fixed costs and reach a desired profit level.

It is useful for:

• sales planning
• pricing strategy
• business forecasting
• profitability targets

Target Profit Formula

Units Needed = (Fixed Costs + Target Profit) ÷ Contribution Margin Per Unit

Where:

• Fixed Costs = business costs that do not change with sales volume
• Target Profit = desired profit amount
• Contribution Margin Per Unit = selling price minus variable cost

Example calculation

If:

• Fixed costs = 10000
• Target profit = 5000
• Selling price = 50
• Variable cost = 30

Then:

• Contribution margin per unit = 20
• Units needed = (10000 + 5000) ÷ 20
• Units needed = 750

What is target profit?

Target profit is the amount of profit a business wants to achieve over a certain period.

This calculator helps turn that goal into a specific unit sales target.

Why target profit matters

Target profit helps businesses:

• set realistic sales goals
• plan marketing efforts
• test whether pricing is sustainable
• evaluate product strategy

When to use this calculator

Use this calculator when you want to:

• plan sales targets
• test pricing scenarios
• estimate required volume
• build profit-focused forecasts

Common mistakes

Common mistakes include:

• using the wrong variable cost
• forgetting some fixed costs
• setting unrealistic target profits
• not checking whether the required units are achievable

Target profit vs break-even

These two concepts are closely linked.

• Break-even tells you when profit starts
• Target profit tells you how much you need to sell to reach a specific profit goal

Related calculations

You may also want to use:

• Break-Even Calculator
• Contribution Margin Calculator
• Profit Calculator

FAQs

What is target profit?

Target profit is the amount of profit a business wants to achieve.

How do you calculate units needed for target profit?

Units Needed = (Fixed Costs + Target Profit) ÷ Contribution Margin Per Unit.

Why is target profit useful?

It helps businesses turn profit goals into practical sales targets.

What is the difference between target profit and break-even?

Break-even is where profit starts, while target profit is the level you want to reach after that.