{
  "slug": "tire-shop-margin-per-unit",
  "title": "Tire Shop Margin Per Unit Calculator",
  "heading": "Tire Margin Per Unit Calculator",
  "category": "financial",
  "url": "https://www.revenuelab.fyi/toolbox/tire-shop-margin-per-unit",
  "summary": "Real profit per tire after cost, mount/balance labor, disposal fees, and warranty reserve.",
  "description": "Tire margin looks thin on the sticker price alone, but the full picture includes mount/balance labor revenue, disposal and FET pass-through, and a warranty/road hazard reserve that should be set aside per unit sold rather than expensed only when a claim happens. This calculator adds all of those pieces to show true profit per tire and per set of four, which matters because tire GP percentage alone (often quoted at 20-30% on the tire itself) understates real profitability once labor attach and add-on sales like alignments and TPMS service are included. Use it to compare vendor cost changes, decide whether a promotional price still clears your minimum margin per unit, and size your warranty reserve realistically instead of guessing.",
  "formula": "Margin per Tire = Sell Price − Tire Cost − Disposal Cost − Warranty Reserve + Mount/Balance Labor Margin. Set Margin = Margin per Tire × 4.",
  "dateModified": "2026-09-30",
  "run_url": "https://www.revenuelab.fyi/api/public/calc?tool=tire-shop-margin-per-unit",
  "inputs": [
    {
      "id": "sellPrice",
      "label": "Sell price per tire",
      "kind": "number",
      "hint": null,
      "default": 165,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "tireCost",
      "label": "Tire cost from vendor",
      "kind": "number",
      "hint": null,
      "default": 118,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "mountBalanceFee",
      "label": "Mount/balance fee per tire",
      "kind": "number",
      "hint": null,
      "default": 22,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "mbLaborCost",
      "label": "Mount/balance labor cost per tire",
      "kind": "number",
      "hint": null,
      "default": 8,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "disposalCost",
      "label": "Disposal fee cost (pass-through)",
      "kind": "number",
      "hint": null,
      "default": 3.5,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "warrantyReserve",
      "label": "Warranty/road hazard reserve per tire",
      "kind": "number",
      "hint": null,
      "default": 4,
      "unit": "$",
      "min": 0,
      "max": null
    }
  ],
  "outputs": [
    {
      "id": "totalPerTire",
      "label": "True margin per tire",
      "format": "currency",
      "hint": null,
      "primary": true
    },
    {
      "id": "setMargin",
      "label": "Margin per set of 4",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "gpPct",
      "label": "Tire-only gross margin %",
      "format": "percent",
      "hint": null,
      "primary": false
    },
    {
      "id": "mbMargin",
      "label": "Mount/balance net margin per tire",
      "format": "currency",
      "hint": null,
      "primary": false
    }
  ],
  "worked_example": {
    "inputs": [
      "Sell price per tire: 165 $",
      "Tire cost from vendor: 118 $",
      "Mount/balance fee per tire: 22 $",
      "Mount/balance labor cost per tire: 8 $",
      "Disposal fee cost (pass-through): 3.5 $",
      "Warranty/road hazard reserve per tire: 4 $"
    ],
    "outputs": [
      "True margin per tire: $53.50",
      "Margin per set of 4: $214.00",
      "Tire-only gross margin %: 28.5%",
      "Mount/balance net margin per tire: $10.50"
    ]
  },
  "how_to": {
    "title": "How to use this",
    "steps": [
      "Enter sell price per tire ($).",
      "Enter tire cost from vendor ($).",
      "Enter mount/balance fee per tire ($).",
      "Enter mount/balance labor cost per tire ($).",
      "Enter disposal fee cost (pass-through) ($).",
      "Enter warranty/road hazard reserve per tire ($).",
      "Read your true margin per tire on the right — it updates as you type.",
      "Hit Share to keep the scenario or send it to someone."
    ]
  },
  "scenarios": [
    {
      "name": "Conservative",
      "description": "Lower-end numbers — what if things land soft?",
      "values": {
        "sellPrice": 100,
        "tireCost": 71,
        "mountBalanceFee": 13,
        "mbLaborCost": 4.8,
        "disposalCost": 2.1,
        "warrantyReserve": 2.4
      }
    },
    {
      "name": "Typical",
      "description": "Defaults — the most common real-world setup.",
      "values": {
        "sellPrice": 165,
        "tireCost": 118,
        "mountBalanceFee": 22,
        "mbLaborCost": 8,
        "disposalCost": 3.5,
        "warrantyReserve": 4
      }
    },
    {
      "name": "Ambitious",
      "description": "Higher-end numbers — what if things really pop?",
      "values": {
        "sellPrice": 265,
        "tireCost": 189,
        "mountBalanceFee": 35,
        "mbLaborCost": 12.8,
        "disposalCost": 5.6000000000000005,
        "warrantyReserve": 6.4
      }
    }
  ],
  "limitations": [
    "Results are estimates before tax, fees, and inflation unless an input explicitly covers them.",
    "Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.",
    "This is educational maths, not financial advice. Check anything contractual with the lender or your accountant."
  ],
  "faq": [
    {
      "q": "Why include mount and balance in tire margin?",
      "a": "Because a tire almost never sells without it, and the labor attach is often the more profitable half of the transaction — a $22 mount/balance fee against $8 in labor cost is 64% margin, much richer than the tire itself, so ignoring it understates how profitable tire sales really are."
    },
    {
      "q": "What's a realistic warranty reserve?",
      "a": "$2-$6 per tire depending on your road hazard program's claim rate and average claim cost. Set it from your actual trailing 12-month claims paid divided by tires sold, not a guess, and revisit it yearly since claim rates drift with the brands and road conditions you sell into."
    },
    {
      "q": "Should FET (federal excise tax) affect margin calculations?",
      "a": "FET is a pass-through cost on certain truck tires and shouldn't be treated as revenue or margin — include it in cost and sell price equally so it nets to zero in your margin calculation, the same treatment as disposal fees."
    },
    {
      "q": "How do promotional tire prices affect this?",
      "a": "Run the promo sell price through this calculator before advertising it. A common mistake is discounting the tire price to match a competitor's ad without checking whether mount/balance and reserve still leave a positive per-tire margin once the discount is applied."
    }
  ],
  "related": [
    "https://www.revenuelab.fyi/toolbox/parts-gross-profit-matrix",
    "https://www.revenuelab.fyi/toolbox/alignment-rack-payback"
  ],
  "license": "CC-BY-4.0",
  "citation": "RevenueLab — Tire Shop Margin Per Unit Calculator (https://www.revenuelab.fyi/toolbox/tire-shop-margin-per-unit)"
}