Contribution margin calculator
Shows how much each unit sold contributes toward fixed costs and then profit.
Loading the tool…
Processing and privacy: The result is calculated inside your browser and your data is not sent to any server.
How to use it
- Enter selling price per unit, variable cost per unit, units sold and fixed costs for the period (optional).
- The result appears straight away and updates as you edit.
- Copy the result, or copy a link that keeps the same values to share it.
How it is calculated
Unit contribution margin = price − variable cost per unit. Ratio = margin ÷ price × 100. Total = margin × units. Operating profit = total − fixed costs.
Example
Inputs: Selling price per unit = 50, Variable cost per unit = 30, Units sold = 1,000, Fixed costs for the period (optional) = 15,000. Result: Contribution margin per unit: 20.00; Contribution margin ratio: 40%; Total contribution margin: 20,000.00.
Limits and caveats
- Assumes variable cost per unit stays flat at any volume; bulk discounts change it.
- Splitting costs into fixed and variable is your judgement, and some items are mixed.
Questions about this tool
How does contribution margin differ from gross margin?
Contribution margin subtracts only variable costs; gross margin subtracts cost of sales, which can include fixed production costs.
What does a negative contribution margin mean?
Each unit sells for less than its variable cost, so more sales mean a bigger loss.
What are examples of variable costs?
Raw materials, packaging, sales commission, payment fees and per-order shipping.