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Calculating turnover and profit
Calculating turnover and profit

This article provides an overview of working with profit & turnover in The Layer.

Written by Raymond Carrel
Updated over a week ago

The turnover value in The Layer takes into account the anticipated revenue (or turnover) value based on multiple different scenarios as outlined below.

Wholesale margin

Wholesale margin is calculated for tariffs that are billed directly via the reseller on a recurring basis. Examples include those services billed via a billing platform or that are invoiced monthly via the reseller’s accounts package.

In price books this is represented as: Recurring sell – discounts (variable) * term


If we sell a PSTN line with a recurring sell price of £10 * 24 the turnover value = £240
If the standard recurring sell price is amended (via variable discount) to £8 then the turnover value is £8 x 24 = £192

Ongoing revenue (OGR)

Ongoing revenue is calculated for tariffs which are predominantly billed by a third party supplier. Mobile networks use this model to provide a % of the customer revenue and this ongoing revenue value is equal to the reseller's turnover.
To set this up, ensure that the recurring buy and sell prices are identical and set 3rd party supplier billed to true.

In price books this is represented as:
Recurring sell * OGR term *OGR%


This is because the ‘true’ turnover is that of the 3rd party billing provider (i.e. Vodafone, O2 or EE) and not the amount of revenue received by the reseller which is the percentage of the OGR paid.

Please note additional spend (overspend) is not included at this stage as this is not guaranteed and is a variable value depending on what the customer is actually billed.

Upfront payments (Commission, Bonuses & Additional funding)

Commission values and bonus values are included at 100% as is any additional funding which is in an approved state.

In price books, this is represented as commission and bonus.


Upfront Service Charges

If you have opted to add an upfront charge to your service items, the upfront sell price will be added to turnover.



Where a customer purchases a product or contributes towards the product cost, this value will also be included in the turnover value.

In price books, this is represented as:
Product sell – discount



Turnover - Turnover is best understood as the 'Revenue' or amount of money that will be posted to the sales ledger in your accounts. You'll see this in the quotation builder under the profit breakdown.

Profit - often referred to as gross profit - is the amount of money made after discounts and costs are taken into account. You'll see this value in "Total Profit" in the quotation builder and in many reports throughout the system.

Profit as a Percentage of Turnover - often referred to as profit margin - is a representation of the profit in your deal and is used as a measurement of its financial value to the business.

We've been working with profit for a while, but how is turnover worked out?


Turnover is worked out differently depending on the source(s) of profit associated with a particular product or service.

The total turnover for a product is derived from the sum of any number of the profit sources, where valid data exists.

Note: Turnover caches are available for both quotations and sales orders, and can be broken down by core service, product type and quotation or sales order item

Turnover - Wholesale Margin

This is where the reseller buys the service for one price and sells it on for another.
The turnover here, when the service is self-billed (new option) is selected, would be the recurring sell price of the service over its term.
It's possible to suppress the calculation of wholesale margin, even where values exist, by specifying 'Third Party Recurring Billing' against the product.

Turnover - Revenue Share

Turnover for ongoing revenue is the sum of the ongoing revenue expected to be paid to the reseller over the minimum term of the agreement.
If required, it is possible to force the system to use the 'Recurring Buy' price to work out the ongoing revenue.

Turnover - Additional Funding

Turnover for additional funding is derived from the sum of all approved commission requests associated with the sales order or quotation.

Turnover - Upfront Commission

Turnover for upfront commission is the full value of any upfront commission paid to the reseller

Turnover - Bonus

Turnover for bonus is the full value of any bonuses paid to the reseller

Turnover - Product & Service Upfront

Turnover for product and service upfront margin is the sell price of the product before any discounts have been applied.

Profit as a percentage of Turnover

Profit as a percentage of Turnover is used in minimum profit calculations when calculation type 'percentage' is selected in company settings.

Gross Profit

Profit is handled separately and referred to in the knowledgebase article. In summary, this figure is the final profit value for the reseller, after all costs have been subtracted.

IMPORTANT: This is closely linked to Third party billed box in the price book

Mark this field as TRUE if your service is billed by the third party service provider, e.g. a mobile operator or software vendor.

If this is marked as TRUE the wholesale Margin will not be added to your turnover figures, only OGR will be included.

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