Click the get a copy button to download a free spreadsheet template, which you can use on Google Sheets, Excel for Mac or PC. If you have any specific questions, perhaps we can help here: contact us.
To be transparent, I didn't build this spreadsheet completely from scratch. I found a waterfall spreadsheet somewhere on the internet and created one for profit margins.
The purpose of a spreadsheet like this is to see how each of your major cost buckets ultimately affect your net income.
After you run the analysis for the total cost, you can also do it for the actual contribution margins. For many businesses, there are industry standards that should be met. For example, in a software business, your Contribution Margin 1 is usually your gross margin. Most good software companies have somewhere around 80% gross margins. Therefore, if you run this analysis and see that your gross profit is much worse than 80%, then it would be a sign that you should try to improve that cost category.