01 · CONTRIBUTION
Find what each revenue dollar contributes.
Subtract variable cost percentage from 100%.
contribution ratio = 1 − variable cost %
Maqtrix Business Tool · 02
Revenue is loud.
Profit tells the truth.
Estimate operating profit, break-even revenue, margin of safety, and the revenue required to reach your target operating margin.
Contribution-margin method
Transparent assumptions
Instant result
Operating model
Profitable
$39K PROFIT
Before tax, debt and owner distributions
26%Operating margin
$90KBreak-even revenue
$60KRevenue cushion
60 break-even transactions
Built on contribution margin
Step 01 · Monthly economics
Enter the operating model.
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Variable costs should rise with sales—materials, merchant fees, commissions, fulfilment, or direct labour. Fixed costs are entered separately.
Step 02 · Business economics
See where profit begins.
Profitable
Estimated monthly operating profit
$22,500
Before income tax, loan principal, capital purchases, owner distributions, and working-capital changes.
Operating margin15.0%operating profit ÷ revenue
Gross profit$97,500after variable delivery costs
Break-even revenue$115,385fixed costs ÷ contribution margin
Break-even transactions77at entered average transaction value
Revenue margin of safety$34,615current revenue above break-even
Revenue for target margin$150,000assuming fixed costs stay constant
Variable costs$52,500
Total fixed operating costs$75,000
Contribution margin ratio65.0%
Educational planning estimate—not accounting, tax, legal, lending, or investment advice. Use actual financial statements and consult a qualified professional before making material decisions.
The Method
Break-even is a
contribution-margin question.
This model separates costs that move with revenue from costs that remain relatively fixed.
02 · BREAK-EVEN
Cover fixed operating costs.
Divide total fixed costs by the contribution margin ratio.
break-even revenue = fixed costs ÷ contribution ratio
03 · TARGET MARGIN
Price the profit goal.
Calculate revenue needed after preserving the desired operating margin.
target revenue = fixed costs ÷ (contribution ratio − target margin)
Profit before scale
Growth should strengthen the business.
V12 connects customer acquisition to real margin, delivery capacity, conversion, and retention—so revenue growth does not quietly destroy profitability.
Set acquisition targets from contribution margin.
Identify the revenue level where fixed costs are covered.
Protect customer experience as volume increases.
Track operating margin alongside top-line revenue.