The contribution margin shows profit per product group or order. The calculation is:
Selling price - Purchase cost = Contribution margin
Activate the contribution margin (CM) sales model, and a Cost tab is added to your products. You can add this to orders and opportunities to calculate CM.
This article covers:
How to activate the CM sales model
- Click Settings → Account → Account settings:
- Under Sales model, select Contribution margin (CM)
- Choose which value is displayed by default:
- Show contribution margin: contribution margin is shown for opportunities, orders, lists and reports
- Show actual order value: the order value is shown, and CM is still available in opportunities, orders, lists and reports
- If your account has the Subscriptions product, you can also combine CM with a recurring revenue model. Turn on Combine with the annual recurring revenue (ARR) sales model. or Combine with the monthly recurring revenue (MRR) sales model. This is useful when you want to include the costs that come from generating your recurring revenue:
- Click Activate sales model (Save changes if CM is already active)
How to set cost for a product
- Click Settings → CRM → Products:
- Click the product you want to edit
- If your account has the Subscriptions product, select the Product type: One-off or Subscription:
- Set the product pricing by switching between the tabs:
- Price: What the customer pays for the product
- Cost: What your business pays for the product
- Click Save
Where CM appears in Upsales
-
Sales board
- Column summaries
- Opportunity cards
- Opportunities
- Orders
- Subscriptions
- Reports
- Target graphs (if a CM target is activated)
How to set CM targets for your users
First, make sure the products you sell have a purchase price in Upsales. You can now set CM targets for your users.