E-commerce Profit Calculator
Revenue Is Not Profit — Five Line Items Stand Between Them
A sale that looks profitable on the invoice can quietly lose money once every cost is accounted for. Online sellers routinely underestimate how much payment processing fees, packaging and shipping, and paid acquisition together eat into a sale — often more than the product cost itself. This calculator forces all five cost categories onto the table at once, so the real profit (or loss) on a sale is never a surprise.
The Formula
Profit Margin = (Profit ÷ Revenue) × 100
COGS is the cost of goods sold — what the product itself cost to make or source. Fees covers payment processing and marketplace commissions. Shipping and ad spend are entered separately so each can be tracked and optimized on its own.
Where This Matters
- Pricing decisions — before setting or changing a price, sellers need to see how much of each dollar actually survives to the bottom line.
- Channel comparison — the same product sold through a marketplace, a paid ad campaign, and organic traffic can have wildly different profit margins once fees and ad spend are factored in separately.
- Spotting loss leaders — a product can have healthy revenue and still lose money after shipping and advertising costs; this calculator surfaces that immediately instead of after the books close.
Same $50 Sale, Three Cost Structures
| COGS | Fees | Shipping | Ad Spend | Profit | Margin |
|---|---|---|---|---|---|
| $15.00 | $2.50 | $4.00 | $8.00 | $20.50 | 41.00% |
| $20.00 | $3.00 | $5.00 | $10.00 | $12.00 | 24.00% |
| $25.00 | $3.50 | $6.00 | $12.00 | $3.50 | 7.00% |
All figures computed directly from the calculator's own formula on a fixed $50 revenue base — note how margin compresses sharply as ad spend rises relative to price.
How to Use This Calculator
- Enter Total Revenue for the sale or period.
- Enter Cost of Goods Sold (COGS).
- Enter Payment/Platform Fees.
- Enter Shipping Cost.
- Enter Ad Spend.
- Select Calculate to see profit, profit margin, and status (profit, loss, or break-even).
Related Calculations
Track the underlying per-unit economics with the Product Margin Calculator, or find the sales volume needed to cover fixed costs with the Break-Even Sales Calculator.