Intermediate Track: “Grow Wisely”

You are a business owner with some experience, ready to refine pricing and strategy.

Who Should Use the Grow Wisely Track

This track is designed for business owners who already have some experience and want to move beyond guesswork. You’re ready to base your markups on actual overhead and profit rates, and you’re actively budgeting and tracking your costs and revenue.

What You’ll Learn

How to calculate your Direct Cost Percentage (your “magic number”)

Why overhead and profit percentages matter for consistent pricing

How to use actual financial statements (income statement or P&L) in your pricing

How to calculate a rental rate that covers costs, overhead, and profit

Direct Cost Percentage

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Direct Cost Percentage

AKA The Magic Number

Why magic? Once you calculate the DCP for your business, it's simple to calculate a retail price from the Direct Cost (DC) of a product or service. The DC is the inventory and labor spent on the item or service you are selling. When the DC is divided by the DCP, a result is a price that has been marked up to cover Overhead expenses and Profit.

Inventory + Labor % DCP = Price

Total Sales Last Year

Total Direct Costs Last Year (Cost Of Goods Sold)

Of Cost Last

Overhead Last Year

Direct Cost Percentage (DCP)

Overhead Percentage

Profit Percentage

Enter Email if you want results emailed to you

Pricing using the DCP

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Direct Costs Material

Pricing Using the DCP

(AKA Using Your Magic Number)

Why this works:

Your DCP already accounts for overhead and profit. When you divide your direct costs by your DCP, you get a price that supports your business, not just your expenses.

This is the same math you can use again and again to price confidently as your business grows.

Direct Cost Percentage (DCP) *

Labor Costs *

Material Costs *

Calculated Price *

Rental Rate Tool

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Rental Rate Tool

Do you need help figuring out what to charge to rent an item you’ve purchased or made? This calculator walks you through the steps so you capture all of your direct costs – the cost to buy or make the item, and any specific extra time involved for that rental. For example, cleaning the piece or rewrapping it/preparing it for storage until the next time it gets rented.

Item To Be Rented: *

Time Rate Item

Purchase Price of Item *

Number of Expected Rentals *

Load and Set Up Time in Minutes

Take Down and Put Away Time in Minutes

Hourly Labor Rate

Your Cost Per Rental

Suggested Rental Price

This number is simply the Cost To Rent doubled. This adds some for your business bills and profit.

Email *

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- Step 1 of 11

Pass this quiz to unlock your bonus tips!

Direct Cost Percentage

Note:
Make sure you read this first!

Based on last year’s actual numbers from your income statement or your profit and loss statement, this tool calculates the direct cost percentage to make pricing quicker. The markup it provides is consistently proportional to overhead and profit across all your products and services. It also provides your overhead and profit percentage rates.

If you don’t do your own year-end taxes, simply ask your bookkeeper or accountant for an income statement. If you don’t know how to read it, ask them to show you what the number means. You need to know what your total sales, total cost of goods sold (COGS) (also known as direct costs), overhead (fixed costs), and profit were.

Now, please proceed to the next slide to try the tool and answer the quiz questions.

To answer the following questions,

If you had $100,000 in sales, $25,000 in direct costs and $35,000 in overhead costs, what is your direct cost percentage (DCP)?

Direct Cost Percentage

Score 1

Price: $1.00

Van Cost the

Answer to # 1 question: 25%

To answer

Based on the example in the previous question, how much was your profit percentage?

Profit Percentage

Score 2

Price: $1.00

Answer to # 2 question: 40%

To answer the following questions,

If you had $40,000 in sales and direct costs are $25,000 and overhead is $1,000 (business insurance only), what is your direct cost percentage (DCP)?

Rental Charge Profite Rate

Score 3

Price: $1.00

Answer to # 3 question: 63%

Direct Cost Percentage:
The “Magic Number”

When you know this number, divide your direct costs by it. The result is a price that
consistently covers your company’s overhead and profit rates. Let's practice.

Using the “Magic Number” (DCP)

Finding the price is easy when you know your DCP

If Direct Costs are $150
And DCP is 45%
The math is $150 / .45

Let's Practice:

Question 1 - Direct cost is $150, DCP is 25%. What is the Price?

Question 2 - Direct cost is $475, DCP is 35%. What is the Price?

Question 3 - Direct cost is $650, DCP is 45%. What is the Price?

Answers to the previous questions:

Question 1: $600
Question 2: $1,357.14
Question 3: $1,444.44

What to Charge for Rentals

Please use the rental rate tool for the next questions

You purchased a backdrop for $368. You hope to rent it out at least 10 times. The prop is simple to set up/take down, no special handling needed. What is the minimum you should charge to rent it out?

Rental Charge

Score 4

Price: $1.00

Answer to # 4 question: $73.60

To answer the following questions,

What to Charge for Rentals

Simple pricing for physical assets.

You built a backdrop that took 8 hours @ $20/hr plus $150 in materials. You hope to rent it 10 times. It disassembles easily, with 10 minutes setup/breakdown. What is the minimum you should charge to rent it out?

Rental Charge Minimum Amount to Charge

Score 5

Price: $1.00

Answer to # 5 question: $62

To answer the following questions,

What to Charge for Rentals

Simple pricing for physical assets.

Rental: $85

Gas: $30

Travel: 30 minutes round trip at $10/hr
Minimum wage = $10/hr

What is the van rental rate for one use?

Rental Charge Van Rental

Score 6

Price: $1.00

score

Answer to # 6 question: $240

Ready to Level Up?

Once you’ve mastered the Intermediate Track: Grow Wisely, you’ll be ready for the Advanced Track: “Scale Smart” — where you’ll learn how to model “what if” scenarios, adjust for growth, and build long-term profit strategies.

Go to Advance Track

DCP Calc

Rental Calc

Please enable JavaScript in your browser to complete this form.

- Step 1 of 11

Pass this quiz to unlock your bonus tips!

Direct Cost Percentage

Note:
Make sure you read this first!

Now, please proceed to the next slide to try the tool and answer the quiz questions.

To answer the following questions,

If you had $100,000 in sales, $25,000 in direct costs and $35,000 in overhead costs, what is your direct cost percentage (DCP)?

Direct Cost Percentage

Score 1

Price: $1.00

Answer to # 1 question: 25%

To answer

Based on the example in the previous question, how much was your profit percentage?

Profit Percentage

Score 2

Price: $1.00

the is Charge

Answer to # 2 question: 40%

To answer the following questions,

If you had $40,000 in sales and direct costs are $25,000 and overhead is $1,000 (business insurance only), what is your direct cost percentage (DCP)?

Rental Charge Profite Rate

Score 3

Price: $1.00

Answer to # 3 question: 63%

Direct Cost Percentage:
The “Magic Number”

When you know this number, divide your direct costs by it. The result is a price that
consistently covers your company’s overhead and profit rates. Let's practice.

Using the “Magic Number” (DCP)

Finding the price is easy when you know your DCP

If Direct Costs are $150
And DCP is 45%
The math is $150 / .45

Let's Practice:

Question 1 - Direct cost is $150, DCP is 25%. What is the Price?

Question 2 - Direct cost is $475, DCP is 35%. What is the Price?

Question 3 - Direct cost is $650, DCP is 45%. What is the Price?

Answers to the previous questions:

Question 1: $600
Question 2: $1,357.14
Question 3: $1,444.44

What to Charge for Rentals

Please use the rental rate tool for the next questions

You purchased a backdrop for $368. You hope to rent it out at least 10 times. The prop is simple to set up/take down, no special handling needed. What is the minimum you should charge to rent it out?

Rental Charge

Score 4

Price: $1.00

Answer to # 4 question: $73.60

To answer the following questions,

What to Charge for Rentals

Simple pricing for physical assets.

Rental Charge Minimum Amount to Charge

Score 5

Price: $1.00

Answer to # 5 question: $62

To answer the following questions,

What to Charge for Rentals

Simple pricing for physical assets.

Rental: $85

Gas: $30

Travel: 30 minutes round trip at $10/hr
Minimum wage = $10/hr

What is the van rental rate for one use?

Rental Charge Van Rental

Score 6

Price: $1.00

score

Answer to # 6 question: $240



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Rental Rate Tool

Item To Be Rented: *

Purchase Price of Item *

Number of Expected Rentals *

Email Load in

Load and Set Up Time in Minutes

Take Down and Put Away Time in Minutes

Hourly Labor Rate

Your Cost Per Rental

Suggested Rental Price

This number is simply the Cost To Rent doubled. This adds some for your business bills and profit.

Email *



Please enable JavaScript in your browser to complete this form.

Direct Cost Percentage

AKA The Magic Number

Inventory + Labor % DCP = Price

Total Sales Last Year

Cost Costs emailed

Total Direct Costs Last Year (Cost Of Goods Sold)

Overhead Last Year

Direct Cost Percentage (DCP)

Overhead Percentage

Profit Percentage

Enter Email if you want results emailed to you

Intermediate Track: “Grow Wisely”

What You’ll Learn

How to calculate your Direct Cost Percentage (your “magic number”)

Why overhead and profit percentages matter for consistent pricing

How to use actual financial statements (income statement or P&L) in your pricing

How to calculate a rental rate that covers costs, overhead, and profit

Direct Cost Percentage

Direct Cost Percentage

AKA The Magic Number

Pricing using the DCP

Pricing Using the DCP

(AKA Using Your Magic Number)

Rental Rate Tool

Rental Rate Tool

Pass this quiz to unlock your bonus tips!

Direct Cost Percentage

Answer to # 1 question: 25%

Answer to # 2 question: 40%

Answer to # 3 question: 63%

Direct Cost Percentage: The “Magic Number”

Using the “Magic Number” (DCP)

What to Charge for Rentals

Answer to # 4 question: $73.60

What to Charge for Rentals

Answer to # 5 question: $62

What to Charge for Rentals

Answer to # 6 question: $240

Ready to Level Up?

Pass this quiz to unlock your bonus tips!

Direct Cost Percentage

Answer to # 1 question: 25%

Answer to # 2 question: 40%

Answer to # 3 question: 63%

Direct Cost Percentage: The “Magic Number”

Using the “Magic Number” (DCP)

What to Charge for Rentals

Answer to # 4 question: $73.60

What to Charge for Rentals

Answer to # 5 question: $62

What to Charge for Rentals

Answer to # 6 question: $240

Rental Rate Tool

Direct Cost Percentage

AKA The Magic Number

Direct Cost Percentage:
The “Magic Number”

Direct Cost Percentage:
The “Magic Number”