Raise your price
A small price rise can add more profit than the same cost cut. Test it on one product and watch the order rate.
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Free profit margin calculator
Enter your product cost and selling price. See your margin, markup, profit, and break-even price at once.
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- No signup
Calculate your profit margin in four steps.
Two numbers give you a quick result. Add every order cost to get the real result.
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Enter your cost per item
Add what one item costs to buy or make. Include materials, labour, duty, and inbound freight. Do not add fixed costs like rent or software here.
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Enter your selling price
Add the price your customer pays. Margin and markup update together as you type. You can also enter a target markup, and the calculator will suggest a selling price.
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Add every order cost
Include shipping, packaging, payment fees, commission, and ad spend. These costs reduce the profit from each sale.
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Review the result
See where the selling price goes. Set a target margin to find the price you need.
What is a good profit margin?
There is no single good margin. It depends on the product, order size, and sales volume. Use these gross margin ranges as a rough check, not as fixed targets.
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Digital products, courses, and software
80% to 95% -
Handmade products, jewellery, and crafts
50% to 70% -
Beauty and cosmetics
50% to 70% -
Apparel and accessories
45% to 65% -
Home, furniture, and decor
35% to 50% -
Packaged food and drinks
25% to 40% -
Grocery and daily essentials
20% to 30% -
Electronics and gadgets
15% to 30% -
Wholesale and B2B distribution
10% to 25%
Digital products have low unit costs. Physical products lose more margin to shipping, returns, and stock.
Net margin uses a different scale. A small online store may keep 5% to 10% after all costs. A 20% net margin is strong.
If gross margin is high but net margin is low, pricing may not be the problem. Check overhead, ads, and fulfilment first.
Six ways to improve your profit margin.
Raising the price is the fastest lever. The rest are the ones you can pull this week.
Stop paying commission on direct orders
A 3% commission takes 10% of the profit from a 30% margin. Sell direct to keep more from each order.
Explore the online store builderCharge for shipping
Either charge shipping or include it in the product price. Do not let it silently reduce your margin.
Increase the order value
Use bundles, multipacks, or minimum orders. One shipping fee can then support more revenue.
Buy stock with care
Bulk buying can lower unit cost. It only helps when the stock sells before you need the cash.
Remove weak products
Sort products by contribution margin, not revenue. A top seller can still lose money after variable costs.
Costs that reduce your margin.
Add every cost linked to an order. Leaving one out makes the result look better than reality.
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Product cost
Include the wholesale price or material cost. Add labour, import duty, and inbound freight when they apply.
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Packaging
Add the box, tape, label, filler, and inserts used for each order.
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Shipping
Use the amount you pay the courier. This may differ from what the customer pays.
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Payment fees
Add the gateway percentage and any fixed transaction fee. International card fees may be higher.
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Marketplace commission
Add the percentage taken from each order. Store.link charges 0% commission.
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Customer acquisition cost
Divide ad spend by the orders those ads produced. Add that cost to each order.
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Returns and refunds
Include return shipping, lost fees, and stock you cannot resell. Estimate this as a percentage of orders.
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Discounts
Discounts come out of the selling price. Add them to see the true margin during a sale.
Profit margin terms.
Six terms that turn up in every pricing conversation, and what each one measures.
- COGS
- The direct cost of the goods you sold. It can include materials, duty, and inbound freight.
- Gross margin
- Revenue minus COGS, shown as a percentage of revenue.
- Contribution margin
- What one extra sale adds after every variable cost.
- Net margin
- Profit after every business cost, shown as a percentage of revenue.
- Break-even price
- The price where a sale makes no profit and no loss.
- Markup
- The gap between cost and price, measured against cost.
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See how Store.link worksStore examples
See real stores across food, fashion, wholesale, and digital products.
Browse store examplesProfit margin calculator questions.
What is a good profit margin?
It depends on what you sell. Compare your result with similar businesses. Make sure it covers fixed costs at your real sales volume.
What is the difference between margin and markup?
Margin measures profit against the selling price. Markup measures profit against the product cost.
How do I calculate profit margin?
Subtract total costs from the selling price. Divide the result by the selling price. Then multiply by 100.
Does this include shipping, fees, and ad spend?
Yes. Open the advanced fields and add each cost linked to the order.
Why does a discount reduce margin so much?
A discount reduces revenue without reducing product cost. The full discount comes out of your profit.
What costs should I include?
Include product cost, packaging, shipping, payment fees, commission, ads, discounts, and expected returns.
What is a break-even price?
It is the lowest price that covers every cost in the sale. Below it, each order loses money.
Is the calculator free?
Yes. It is free with no signup or usage limit.
Are my numbers saved or uploaded?
Nothing is uploaded. Your numbers stay in your browser on this device.
Can I use it for services?
Yes. Use labour as the main cost. Add tools, travel, fees, and customer acquisition costs.
Keep the margin you calculated.
Turn your Google Sheet into an online store. Sell direct without paying commission on each order.
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