Enter selling price and total cost to calculate profit per sale, profit margin, markup and the selling price needed for your target margin.
Include whichever per-sale costs you want the margin to reflect.
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The calculator above compares selling price with the total cost assigned to one sale. Enter price and total cost to see profit dollars, profit margin, markup and cost as a percentage of revenue. You can also enter a target margin to solve for the selling price required to reach that margin. The optional cost builder lets you add product cost, shipping, advertising and fees or other costs before copying their total into the main calculation.
The result is only as complete as the cost number you enter. If total cost includes only inventory, the calculator shows a gross-style product margin. If it also includes fulfillment, marketplace or payment fees, advertising, expected returns and other variable expenses, the result is closer to contribution or order-level net margin. Keep the definition consistent when comparing products.
Margin and markup should not be used interchangeably. A product that costs $20 and sells for $30 generates $10 profit. Its margin is 33.3% because $10 is one-third of the selling price. Its markup is 50% because $10 is half of the $20 cost. Pricing decisions can be distorted when one metric is mistaken for the other.
Assume product cost is $12, fulfillment is $4, advertising averages $3 per sale and marketplace or payment fees plus packaging total $2. Total cost is $21. At a $30 selling price, profit is $9, margin is 30% and markup is about 42.9%. If you want a 40% margin while the same $21 cost remains, the target-price formula gives $35.00. That price leaves $14 profit, which is 40% of revenue.
| Cost layer | Example | Include when |
|---|---|---|
| Product / landed cost | $12.00 | Always for product-level profitability |
| Shipping / fulfillment | $4.00 | When seller economics absorb the cost |
| Advertising | $3.00 | When evaluating profit after acquisition |
| Fees / packaging / other | $2.00 | When those costs are attributable to the order |
Fixed monthly overhead can be handled separately or allocated per order by dividing it by expected monthly orders. Whichever approach you choose, use the same cost definition across products so margin comparisons remain meaningful. A high margin calculated before advertising is not directly comparable with a lower margin calculated after advertising.
Net profit margin for this order model is profit divided by selling price, multiplied by 100. It depends on which costs you include in the total cost per sale.
Margin divides profit by selling price. Markup divides profit by cost. The same sale can therefore have a 30% margin and a much higher markup percentage.
Target price equals total cost divided by one minus the target margin expressed as a decimal. A $20 cost at a 40% target margin requires about $33.33.
Include every cost you want the reported margin to represent. For ecommerce order economics, that commonly includes product, fulfillment, payment or marketplace fees, advertising and expected returns.
See our calculation methodology for cost definitions and the Product Pricing Calculator for more detailed pricing scenarios.
The returns guide models a kept-order profit of $20.96 and a returned-order outcome of −$30.04. At 10% returns, expected profit is $15.86 per original order. The $5.10 reduction includes inventory recovery and added handling.
Use either the full outcome model or an equivalent expected-loss allowance. Do not deduct both. Recovered inventory value is not cash received.
Work through a returned-order example →
Original hypothetical worked example. Read the guide for all assumptions, formulas and exclusions.