How this calculator works
Bundling multiple components into one kit creates hidden work: extra packaging, assembly time, lost or damaged parts, and fulfillment charges. A kit estimate is more useful than using component cost alone.
What the calculation does
Calculate the bill of materials using average component cost times parts per kit. Add component waste allowance, packaging and assembly labor. Compare the resulting kit cost against sales price after the selected selling fee.
Important limitations
For different component types, use a reliable average weighted by actual bill-of-materials quantities. Margin excludes additional shipping, tax, returns, marketing, and shared overhead.
Common questions
Can I use this for different types of components?
Yes, if the average component cost correctly represents the specific mix; otherwise calculate total bill of materials separately.
Is profit the same as cash received?
No. Contribution subtracts selected direct costs and selling fees only; taxes, cash timing and fixed costs are separate.
Why include an assembly waste allowance?
It models expected breakage, rejects or lost components; enter zero if you have no losses.