Ecommerce Profit Calculator

Profit margin = (sales − product, shipping and fees − ad spend − fixed costs) ÷ sales × 100. In the example: $18,000 − $8,100 − $3,600 − $2,000 is $4,300. Divided by $18,000, that's 23.9%. Gross margin, before ads and fixed costs, is 55% here.

Net margins of 10% to 20% are healthy for most online stores. Stores selling their own brand often do better than resellers or dropshippers, who may net 5% to 10%. The example nets 23.9%. Watch contribution margin too: profit per order after product, fees and ads, before fixed costs.

It varies more than almost any business. Many new stores make little or lose money for months, while established ones can earn thousands. The example makes $4,300 a month on $18,000 in sales. Monthly profit is profit per order after ads, times orders, minus fixed costs.

Divide monthly fixed costs by profit per order after product, fees and ads. In the example, each $60 order leaves $60 × 55% − $12 = $21. $2,000 ÷ $21 is about 96 orders a month. The calculator shows yours.

It needs to stay below your gross profit per order, or each sale loses money. In the example, each order leaves $33 before ads, so ads must cost less than that. Many stores aim to spend 20% to 40% of gross profit on ads for new customers, and more if those customers buy again.

Often $1,000 to $25,000: store platform, design, first inventory, product photos, samples and launch ads. Dropshipping costs less up front but leaves thinner margins. The example uses $15,000. Keep some cash for ads while you learn what works.

Product cost, inbound freight, packaging, shipping to customers, payment processing (often about 3%), marketplace fees if you sell on Amazon or Etsy (often 8% to 15%), returns and app subscriptions. Enter per-order costs as a share of sales and monthly subscriptions as fixed costs.

Many stores take 6 months to 2 years. The example pays back in 4 months because it already has 300 orders a month. A store starting from zero takes longer to build traffic. Track profit per order from the start, since a store that loses money on each order can't grow its way out.

It can be, but margins are thin because you pay more per item and compete on ads. Enter a higher product cost share, often 60% to 75%, and your ad cost per order. If profit per order is under a few dollars, a small rise in ad costs wipes it out.

Raise average order value with bundles, upsells and free-shipping thresholds. Lower ad cost per order with better creative, email and repeat customers. Negotiate product and shipping costs as volume grows. In the example, $15 more per order lifts monthly profit from $4,300 to $6,775.