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Retail economics / follow the revenue

Dispensary Profit Margin Calculator

See what inventory and operating expenses leave from your sales. Compare an expense budget, with every assumption in view.

Browse Dispensary toolsTrace your margin
01 / One accounting period

Enter sales and costs

Use USD and the same period for every field. Include each expense once; the example values are not industry averages.

Gross is only the first step.

Gross profit subtracts cost of goods sold from net sales. Operating profit also subtracts the labor, overhead and other fees you enter.

This simplified estimate is not net income or cash flow. Interest, income taxes and any omitted expenses are not calculated separately.

Test an expense budgetKeep sales and COGS. Compare a different operating-expense total.

What would a different budget leave?

This alternative replaces the combined labor, overhead and other fees total for the same period. It does not add to those costs or change your original estimate.

Same sales & COGSOriginal modelAlternative
Gross profit——
Operating expenses——
Operating profit——
Operating margin——

Enter an alternative expense total to compare.

A budget change is a scenario, not a forecast. Sales, inventory cost and service levels may also change in practice. This model does not estimate those effects.





What it calculates
Use the result as a scenario, not a black box
See where retail revenue goes before it becomes profit. Enter sales, cost of goods, labor, overhead and other operating fees to calculate gross margin and a simple operating-margin estimate for a licensed cannabis retailer.
Gross margin tells you how much revenue remains after inventory cost. Operating margin goes further by subtracting labor, rent, software, security and other operating expenses you enter. The result is useful for scenario planning because you can immediately see whether a pricing change, purchasing improvement or overhead reduction has the biggest effect.
How the math works
Gross profit = revenue − COGS. Gross margin = gross profit ÷ revenue. Operating profit = gross profit − labor − overhead − other fees. Operating margin = operating profit ÷ revenue.
Example
A store with $250,000 in net sales and $135,000 of COGS has $115,000 of gross profit, a 46% gross margin. After $42,000 labor, $36,000 overhead and $12,000 other expenses, the simple operating profit is $25,000, or 10%.
Reconcile cost of goods with Inventory Turnover and model coverage with Budtender Staffing.
Review Setting up a marijuana dispensary, Dispensary POS systems and Business planning tools for the surrounding retail plan.
The SEC’s financial statement guide explains the progression from revenue to gross and operating profit, and why operating profit differs from net income and cash flow.



FAQ
Questions about this calculator
What is the difference between markup and margin?
Markup compares profit to cost. Margin compares profit to selling price or revenue. They are not interchangeable.
Should sales tax be included in revenue?
Usually operating analysis uses net sales excluding taxes collected on behalf of a government, but follow your accounting treatment.
Can I use this for one product instead of a whole store?
Yes. Use product revenue and product-level COGS, then include only the directly allocated operating costs you want to model.


From operating result to next decision
Choose your next lever.
Use pricing, sales volume and purchasing assumptions to investigate your next scenario.
Retail pricingProduct PricingCheck how unit costs and target margin set a pre-tax price.Unit economicsBreak-EvenModel fixed costs and the unit sales needed to cover them.Licensed wholesaleWholesale MarginCompare wholesale revenue and costs on a consistent basis.