Use the live model below to run “what-if” scenarios with changes in price, direct and overhead costs, and volume to understand the impact of the most critical financial levers for profitability in your company. Simply enter your revenue and direct and overhead expense totals to seed the model, and play out profit scenarios by modeling changes to price, volume, and costs.

This model is extremely useful to combat the seductive sales myth of “making it up in volume.” Often, the increased volume doesn’t justify the requested discount. (Also: sales teams notoriously overestimate the volume they will gain at discounted prices.) For example, a company with 25% gross margin and 5% EBITDA that discounts 5% to gain 20% in volume will earn 20% LESS EBITDA. Don’t go home tired AND hungry.

Want to forecast your future profits under different scenarios? Use our live profit levers model below today! Interested in downloading a version to your computer? Click here.

INSTRUCTIONS:

• Populate revenue, cost of goods sold (also called COGS or direct costs), and overhead costs, all in total dollars. The model will display gross and net margin.

• Input the percent change in price, volume, COGS, and/or overhead costs to see the change in revenue, gross margin, and net profit.

• To isolate the impact of just one lever (price or volume or cost), change only one lever and leave the rest at 0% change.