Business Math & Profiting From Any Business

How to Use This Course

Read in order. Each lesson builds on the one before it.
Do the mini exercises. That's how the math becomes easy.
Keep a "Business Money Notebook." Write your numbers in one place.

What You Will Learn (The Promise)

By the end, you will be able to:

Price anything with confidence
Know your real costs (even hidden ones)
Predict profit before you sell
Track money weekly without stress
Stop guessing and start running your business with numbers

The One Big Truth About Profit

Profit is not what you "feel." Profit is what's left after ALL costs are paid.

Profit = Sales - Costs

But in real life, "costs" has two big parts:

Variable costs (change when you sell more)
Fixed costs (stay about the same each month)

Module 1

The Money Words (So You Don't Get Confused)

1

The 12 Most Important Business Math Words

1) Revenue (Sales)

All the money you collect from customers.

Example: You sold 10 items for $20 each → revenue = $200.

2) Cost

Money you spend to make or deliver what you sell.

3) Profit

Money left after costs.

Profit = Revenue - Costs

4) Variable Cost (Cost per sale)

Costs that happen each time you sell one unit.

Ingredients
Packaging
Shipping label
Payment processing fee

5) Fixed Cost (Overhead)

Costs that happen even if you sell nothing this week.

Rent
Phone bill
Website hosting
Insurance

6) Gross Profit

Revenue minus only the variable costs.

Gross Profit = Revenue - Variable Costs

7) Net Profit

What's left after all costs (variable + fixed) are paid.

Net Profit = Revenue - (Variable + Fixed)

8) Margin (Profit Percent)

How much profit you keep from each dollar of sales.

Profit Margin % = (Profit ÷ Revenue) × 100

9) Cash Flow

When money comes in and when it goes out.

Important: A business can be "profitable" on paper but still run out of cash.

10) Break-Even

The point where profit is $0 (not losing, not winning).

11) Average Order Value (AOV)

Average amount a customer spends per purchase.

AOV = Total Revenue ÷ Number of Orders

12) Customer Acquisition Cost (CAC)

How much it costs to get one customer (ads, promos, etc.).

CAC = Marketing Spend ÷ New Customers

2

Two Types of Businesses (Same Math)

Almost every business is either:

Products (sell items)
Services (sell time/skill/results)

Good news: The profit math is the same.

Module 2

Start-Up Math (Before You Sell Anything)

3

The "Start-Up Cost List"

Start-up costs are the one-time costs to begin.

Examples:

Equipment, tools, printer
Licenses
First inventory
Website setup
Branding

Step-by-step: How to list start-up costs

Write every item you must buy to start
Put a price next to each
Add them up

Start-Up Total = sum of all start-up items

Rule: Start-up costs are NOT the same as monthly costs.

4

Monthly Fixed Costs (Your "Survival Number")

Make a list of monthly bills:

Rent / home office portion (if you use it)
Phone
Internet
Website / software
Insurance
Subscriptions
Gas (if the business depends on driving)

Add them up:

Monthly Fixed Costs = Total Overhead

This number matters because it tells you: How much you must make each month just to stay alive

Module 3

Cost Per Unit (The Most Important Skill)

5

Your Real Cost Per Sale (Product Business)

Every item you sell has a real cost.

Cost per unit includes:

Materials/ingredients
Packaging
Shipping (if you pay it)
Labor (your time counts—more on this soon)
Payment fees (card fees)
Returns/damage allowance (small %)

Unit Cost = Materials + Packaging + Shipping + Fees + Labor (optional but smart)

Mini-example:

You sell a candle.

Wax + scent: $4.00
Jar: $2.00
Label/box: $1.00
Card fee: $0.75

Unit cost = $7.75

6

Your Real Cost Per Job (Service Business)

Service businesses still have "unit costs," but it's usually:

Your time
Supplies
Travel
Tools wear-and-tear
Payment fees

Step-by-step:

How long does one job take? (in hours)
What supplies do you use per job?
What travel costs happen per job?

Job Cost = Supplies + Travel + Fees + (Hours × Your Hourly Target)

Important: Even if you don't pay yourself yet, you should still count your time so your pricing is real.

Module 4

Pricing That Creates Profit (Not Hope)

7

The 3 Pricing Methods (Use at Least 2)

Method A: Cost-Plus Pricing (Simple & safe)

Price = Unit Cost + Profit Amount

Or use markup:

Price = Unit Cost × Markup

Example: Unit cost $10. If you use a 2.5× markup → price = $25.

Method B: Market Pricing (Reality check)

Look at what others charge.

But don't copy blindly—your costs might be different.

Method C: Value Pricing (Best when you deliver results)

If you save someone time, stress, or money, you can charge more.

Best practice: Use cost-plus to protect profit + market/value to maximize profit.

8

The "Minimum Price" You Must Charge

This is your survival pricing.

Step-by-step:

Find unit/job variable cost
Find your monthly fixed costs
Estimate how many units/jobs you can sell per month

Fixed cost per sale = Monthly Fixed Costs ÷ Expected Monthly Sales

Minimum price = Variable Cost per Sale + Fixed Cost per Sale

Example:

Monthly fixed costs: $600
Expected sales: 60 orders/month

Fixed cost per order = $600 ÷ 60 = $10

If variable cost per order is $8:
Minimum price = $8 + $10 = $18

If you price at $18, profit is basically $0.
So you must price higher to actually profit.

9

Profit Margin Targets (Simple rules)

These aren't "laws," but they're useful targets:

Services: often aim 30%–60% net profit (depends on overhead and time)
Products: often aim 10%–40% net profit (depends on industry, shipping, returns)

Warning: If your margin is tiny, one surprise expense can wipe you out.

Module 5

Break-Even (Know Exactly When You Stop Losing)

10

Break-Even Point (Units or Jobs)

Break-even units = Fixed Costs ÷ Profit per Unit

Where:

Profit per unit = Price - Variable cost

Example:

Fixed costs: $600/month
Price: $25
Variable cost: $10

Profit per unit = $15
Break-even units = $600 ÷ $15 = 40 units

So:

First 40 sales pay the bills
Sales after that create profit

Module 6

The Profit Plan (A Simple System That Works)

11

The Weekly Money Routine (15–30 minutes)

Do this once a week:

Total Sales This Week
Total Costs This Week (materials, supplies, ads, fees)
Profit This Week = Sales - Costs
Set aside taxes (even a small % is better than 0)
Pay yourself (even a little)
Reinvest (inventory, tools, marketing)

The "4-Bucket" method (simple)

When money comes in, split it into buckets:

Taxes bucket
Owner pay bucket
Bills bucket
Business growth bucket

You pick the percentages based on your situation, but the habit is what matters.

12

The 1-Page Profit Tracker (What to track)

Track these every week:

Revenue
Number of sales (orders/jobs)
Average order value (AOV)
Variable costs
Fixed costs
Net profit
Cash on hand

If you track this, you stop guessing.

Module 7

Marketing Math (So You Don't Lose Money Getting Customers)

13

Know Your Numbers Before You Run Ads

AOV (Average Order Value)

AOV = Total Revenue ÷ Orders

CAC (Cost to Acquire Customer)

CAC = Marketing Spend ÷ New Customers

Rule: If CAC is too close to your profit, you're working for free.

Example:

Profit per order is $20
CAC is $18

That leaves $2 profit (not enough)

Fix by:

raising price
increasing AOV (bundles/upsells)
lowering CAC (better targeting, referrals, organic content)

14

The Simple Upsell Math

Upsells increase profit without needing new customers.

Examples:

Add-on service
Bundle deal
Premium option

If 20% of customers take a $10 add-on:
100 customers → 20 upsells → extra $200 revenue
Often with low extra cost.

Module 8

The "Time is Money" Lesson (For Services & Solopreneurs)

15

Your Hourly Target (So you don't undercharge)

Even if you hate math, do this once:

Pick monthly income goal (example: $4,000)
Add monthly business bills (example: $600)
Add taxes estimate (example: $800)
Needed total = $5,400
How many billable hours can you work?
Example: 25 hours/week × 4 = 100 hours/month
Hourly target = $5,400 ÷ 100 = $54/hour

Now you price your services based on reality.

Module 9

Common Profit Killers (And Fixes)

16

Why Businesses "Sell a Lot" But Still Lose

Common causes:

Pricing too low
Not counting all costs
Too many discounts
Shipping/fees eating profit
Wasting money on tools/subscriptions
Buying inventory that doesn't sell
Not tracking numbers weekly

Fix:
You don't need perfect math.
You need consistent tracking + small adjustments.

Module 10

Scaling Profit (Growing Without Breaking)

17

Scale Only What's Already Profitable

Before you scale:

You know your unit/job profit
You know break-even
You have a repeatable way to get customers

Scaling means:

more sales with the same quality
systems to save time
maybe hiring help

18

Hiring Math (So you don't hire too early)

If you hire someone, the business must still profit.

Simple rule:
Hire when the help allows you to produce more profit than their cost

Example:

Assistant costs $400/week
Their help frees you to do $900/week more in profitable work

Net gain = $500/week → good hire

19

The "Raise Prices" Plan (Without Losing Customers)

Raise prices when:

you're busy
demand is strong
your costs went up
your results are strong

Do it safely:

raise 5%–15%
improve offer (faster, better, more value)
keep old customers on old price temporarily (optional)

Module 11

Real-World Examples (Product + Service)

Example A: Product Business (Simple)

You sell T-shirts.

Price: $25
Cost per shirt: $11

Profit per shirt: $14

Monthly fixed costs: $700

Break-even shirts = $700 ÷ $14 = 50 shirts

If you sell 80 shirts:

Profit before taxes = (80 × 14) − 700 = 1,120 − 700 = $420

Example B: Service Business (Simple)

You do home cleaning.

Price per clean: $150
Supplies + travel + fees: $20

Gross profit per job: $130

Monthly fixed costs: $500

Break-even jobs = $500 ÷ 130 = 3.85 → 4 jobs

Everything after job #4 is profit (before taxes and owner pay planning).

Module 12

Your Step-by-Step Profit Setup (Do This In Order)

Write your offer
What you sell, who it's for, and what they get.
List start-up costs
Add them up.
List monthly fixed costs
Add them up.
Calculate your cost per sale/job
Be honest. Count fees.
Choose a minimum price
Minimum price = variable cost + fixed cost per sale
Set your "real price"
Use value + market + profit goals.
Find break-even
Break-even = fixed costs ÷ profit per sale
Track weekly
Use the simple tracker every week.
Improve one number each week
Choose one:
- lower costs
- raise price
- increase AOV
- reduce CAC
- reduce refunds/returns
- increase repeat customers
Scale what works
Add systems, upsells, and repeatable marketing.

Worksheets

Mini Worksheets (Copy/Paste)

Worksheet 1: Monthly Fixed Costs

Rent/space: $______

Phone: $______

Internet: $______

Website/software: $______

Insurance: $______

Subscriptions: $______

Other: $______

Total fixed costs: $______

Worksheet 2: Cost Per Sale/Job

Materials/supplies: $______

Packaging: $______

Shipping/travel: $______

Fees: $______

Other: $______

Variable cost per sale/job: $______

Worksheet 3: Pricing & Profit

Price: $______

Variable cost: $______

Profit per sale = Price − Variable cost: $______

Monthly fixed costs: $______

Break-even sales = Fixed ÷ Profit per sale: ______

Final Cheat Sheet (Simple)

Profit = Revenue − Costs

Net Profit = Revenue − (Variable + Fixed)

Profit per sale = Price − Variable cost

Break-even sales = Fixed costs ÷ Profit per sale

Minimum price = Variable cost + (Fixed ÷ Expected sales)