Packaged Drinking Water Profit Margin & Break-even Calculator
Find out how much you actually earn per case, how many cases cover your monthly expenses, and whether higher sales volume will improve your business.
Calculate your factory economics
Enter your own figures in rupees. Sample values are illustrative, not market quotations.
Your results
This is an operating estimate before interest, tax, depreciation and extraordinary expenses. If your selling price includes GST, first remove GST using the applicable rate. Treat EMI principal repayment as cash flow, not an operating expense. Use consistent tax treatment for all inputs.
Open detailed manufacturing cost calculator →How to calculate profit in a packaged drinking water factory
Step 1: Work out net sales per case. Use selling price excluding GST and deduct trade discounts or incentives that reduce realised revenue.
Step 2: Calculate variable cost. Add PET preform, cap, label, shrink film, packing wastage, variable conversion costs, loading and delivery expenses that rise with production or sales.
Step 3: Calculate contribution. Net selling price minus variable cost and variable freight is the amount each case contributes toward fixed costs and profit.
Step 4: Allocate fixed costs. Monthly salaries, rent, minimum electricity charges and other fixed operating overheads must be recovered through total contribution.
Step 5: Find break-even. Divide monthly fixed operating expenses by contribution per case. A negative contribution cannot be repaired by increasing sales volume alone.
Example: Why sales volume alone can mislead
Suppose a factory sells a case for ₹95 excluding GST, incurs ₹70 in variable manufacturing costs and ₹5 in variable delivery expenses. Contribution is ₹20 per case. With ₹6,00,000 in monthly fixed operating expenses, break-even is 30,000 cases per month. At 40,000 cases, estimated monthly operating profit is ₹2,00,000 before interest, depreciation and taxes. These are illustrative figures only.
Profit margin versus markup
Markup compares profit to cost; margin compares profit to sales. For a case sold at ₹100 with ₹80 total attributable cost, the ₹20 profit is a 20% margin on sales but a 25% markup on cost. Mixing the two can lead to incorrect dealer pricing.
Questions water manufacturers ask
Does the calculator include EMI?
No. Interest is a financing expense, while repayment of loan principal affects cash flow rather than operating profit. Analyse both separately before deciding whether the business generates enough cash.
Should I include GST in the selling price?
Use a consistent net-of-GST basis when GST is recoverable. Actual tax treatment depends on your transactions; consult your accountant for applicable rates and input tax credit eligibility.
What if my contribution per case is negative?
Review selling price, packaging specifications, wastage, freight and channel discounts. Selling more at a negative contribution increases operating losses unless the unit economics change.
Explore related AquaProfit guides
200ml bottle costing · 250ml bottle costing · 500ml bottle costing · 1-litre bottle costing · PET preform sourcing