Handeware
Business

Profit per sale

$14.49
Margin
36.2%

This is arithmetic for general information, not financial advice.

Dropshipping Profit Calculator

In dropshipping the supplier ships the item, but the costs still add up. This shows what is left from one sale after everything comes out, so a sale that looks good on paper can be checked before you spend on ads.

How it works

Start with the selling price. Take away the supplier cost, the shipping you pay, the ad cost for the sale and the payment fees. Payment fees are a percent of the price plus a fixed amount per sale. What is left is the profit, and dividing it by the price gives the margin.

Worked example

Selling at $39.99 with $14.50 from the supplier, $3.50 of shipping and $6.00 of ads, you keep $14.49 per sale after payment fees, a margin of 36.2%.

Questions

Does this include returns?

No. Refunds, chargebacks and damaged items cut into profit too. Add a rough allowance to the cost if your returns run high.

Why does the ad cost matter so much?

Ads are paid for on every sale, so a small profit can disappear fast. Enter the cost per sale you actually see, not the cost per click.

Is a positive profit enough?

It is a start. Check that the margin still works after your time and any tools you pay for each month.

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