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MSP Stack Profitability Calculator

By The MSP Playbook
Independent editorial desk
The MSP Playbook editorial desk covers Australian managed services, contracts, pay, and workplace practice. Articles identify the evidence used and distinguish reporting from analysis.
How this article was reported and checked
Free planning tool

Model the relationship between price, stack cost, and delivery capacity.

Enter the numbers for one client or one service package. The calculator runs in your browser and shows the assumptions behind the result. No email address is required.

Illustrative resultβ€”
β€”gross profit / month
β€”gross margin
β€”direct cost / month
β€”revenue / unit / month
Read the assumptions: This model uses only the numbers you enter. It excludes tax, financing, sales and marketing, general administration, depreciation, owner distributions, and one-off implementation work unless you include them. Use your accounting data for decisions and compare like-for-like service scopes.

How to use the result

  • Gross profit is monthly recurring revenue less the direct costs entered in the model.
  • Gross margin is gross profit divided by monthly recurring revenue.
  • Delivery cost converts the hours and loaded hourly cost into a direct labour estimate.
  • Revenue per unit helps you compare packages with different user or device counts.

For the commercial context, read Strategic MSP Pricing, MSP Profit Margin Analysis, and How to Grow an MSP Without Breaking Service Delivery.

The calculator doesn’t tell you whether a price is fair by itself. A service can show a strong margin and still fail if the promise is vague, response commitments are unrealistic, or documentation and security work are missing. Pair the result with the MSP Procurement Scorecard and the MSP Cost Calculator.

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Editorial note: This article separates sourced facts, submitted experiences, and analysis. Check the linked sources, and contact the editorial desk if you find an error or need a correction.

Frequently Asked Questions

What does the MSP Stack Profitability Calculator measure?
It estimates gross margin from recurring monthly revenue, direct software and service costs, delivery labour, and other direct costs that you enter. It is a planning model, not an accounting report.
Does the calculator use vendor pricing automatically?
No. You enter the prices and costs that apply to your agreement. This avoids presenting stale vendor pricing as a current fact and makes the assumptions visible.
What gross margin should an MSP target?
There is no universal target for every service, client, or accounting method. Compare the result with your own costs, service promise, staffing model, and financial reporting. Treat any target as a management assumption, not a guarantee.
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