What problem does this calculator solve?
Many sellers know their selling price but not the contribution each sale makes after costs. Our calculator includes purchase cost, shipping, platform fees, and other variable expenses.
A high markup is not the same as a high margin. Shipping, platform fees, and other variable costs determine how much each sale contributes.
Six practical questions, answered clearly
Find the calculation behind your question. These answers explain how to use the inputs and results when making a decision.
How much money remains after a product sale?
Subtract the relevant variable costs from net sales revenue. With €100 in net revenue and €70 in total variable costs, €30 remains as contribution before fixed costs and income taxes.
How do I calculate a product’s profit margin?
Divide contribution by net sales revenue and multiply by 100. A €30 contribution on €100 of revenue is a 30% margin.
Why is my margin lower than my markup?
Markup uses cost as its denominator, while margin uses selling revenue. The same contribution therefore produces different percentages.
What selling price gives me a 40% target margin?
With €60 in total variable costs, a 40% margin requires €100 in net sales revenue, provided there are no additional revenue-based fees.
How do shipping costs affect my contribution?
Each additional euro of shipping cost that is not recovered from the buyer reduces contribution by one euro.
How can I identify products with weak profitability?
Compare contribution and margin across products, then consider sales volume, returns, and fixed costs. A strong percentage alone does not show total business profitability.
Worked example
With €100 net revenue and €60 total cost, contribution is €40: a 40% margin and a 66.67% markup. A 30% target margin requires a rounded-up price of €85.72.
Formula and calculation method
Calculate using your own assumptions
Enter values in a single currency. Results update as you change inputs. Save up to three scenarios for this session. Copy and CSV export include the assumptions and explanations used.
Practical use cases
- Include shipping and packing in unit economics.
- Distinguish margin from markup during sourcing.
- Check a price needed for a target margin.
Assumptions and limitations
Use consistent net amounts. Fixed costs, income taxes, and unentered returns are excluded. The additional percentage fee applies to net revenue and is included in target pricing. Use a marketplace calculator for fees with a different base.
FAQ: Using the tool, capabilities, and calculation limits
How does contribution differ from business profit?
Contribution is revenue minus variable costs. Final business profit also accounts for fixed costs and other expenses.
Can platform fees be included in the margin calculation?
Yes. Enter fixed fees per sale and any additional percentage fee on net revenue. Do not include the same fee in both fields.
Should I enter tax-exclusive or tax-inclusive amounts?
The default business calculation uses consistent net amounts. Recoverable VAT should not be mixed into revenue or costs.
Can I specify the margin I want to achieve?
Yes. The calculator solves for the selling price using your costs and target margin, including the entered revenue-based fee.
Can a product have a negative margin?
Yes. If variable costs exceed net revenue, the sale produces a negative contribution.
How much remains after variable selling costs?
Subtract purchase, shipping, platform fees, and other variable costs from net revenue. The result is a unit contribution before fixed costs and income taxes.
What is the difference between margin and markup?
Margin divides contribution by selling revenue. Markup divides that same contribution by cost, so the percentages can differ substantially.
How do I price for a 30% margin?
With no additional percentage fee, divide fixed per-unit costs by 0.70. With a revenue-based fee q as a decimal, the denominator is 0.70 − q and must be positive. The target price rounds up to the next cent.
Why is contribution negative despite high sales revenue?
Entered variable costs exceed net revenue. More sales under the same assumptions increase the loss contribution unless price or costs change.
Should VAT be counted as profit?
Not in a net calculation. Separate output VAT from revenue and use comparable net costs. Nonrecoverable taxes can be real costs and require a separately established cost basis.
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