Profit Margin Calculator: gross, net, and the price you need
An $8.40 unit at $24.99 is a 66.4% gross margin. After $1.20 shipping, 2.9% fees, and $0.50 overhead it nets $14.17 (56.7%). A 35% net target only needs $16.26. Pricing a 50% markup when you meant a 50% margin is how you underprice.
The calculator opens with a typical private-label example. Replace every field with your own numbers, and use landed cost for the unit cost, not the supplier invoice price.
Net profit margin
56.7%
Gross margin
66.4%
Markup
197.5%
Net profit / unit
$14.17
ROI on cost
131.0%
Price for a 35% margin
$16.26
Your current price already clears that target.
Calculate your margin
Every figure is per unit unless labelled otherwise. Results update as you type.
Where the price goes
Monthly at 500 units
This margin is only as good as your unit cost.
SupplyAutomate tracks the real cost of every purchase order, including supplier price, freight, duty, and prep, so the margin you model here matches the one you actually earn.
The four numbers
Margin, markup, and the gap between them
Margin and markup describe the same profit against different denominators, and mixing them up is the most expensive arithmetic error in ecommerce pricing. A product costing $8.40 sold at $24.99 carries a 66.4% gross margin but a 197.5% markup. Price to the markup figure when you meant the margin and you will land well under the number you planned for.
Gross margin
Selling price minus the unit cost of the product, as a percentage of the price. Measures the product itself.
Net margin
The same calculation after shipping, payment fees, and overhead. Measures the business.
Markup
Profit over cost rather than over price. Always a bigger number than margin, and easy to confuse with it.
Target price
Work backwards: name the margin you want and get the price that delivers it after fees.
Selling on Amazon or a Shopify store?
Referral fees, fulfilment fees, and ad spend change the picture enough to deserve their own tools. Use the Amazon profit calculator for FBA, or the dropshipping profit calculator for a DTC store. To get the unit cost right in the first place, start with the landed cost calculator or the import duty calculator.
Profit Margin Calculator FAQ
The calculator is free. The margin is the hard part.
A margin built on a guessed cost is a guess.
Every number above depends on what your unit truly costs delivered. SupplyAutomate reads your invoices, files them against the right order, and keeps that cost current as freight and duty land, so the margin you priced against is the margin you get.
Related reading
- How to calculate landed cost: the inbound unit this calculator should be using, not the factory invoice.
- Landed cost vs COGS: why a $10 invoice is not the cost that hits the P&L.
- True product cost, factory to warehouse: a $4.80 factory SKU that is $6.20 once it is sellable stock.
- Amazon profit calculator and the dropshipping profit calculator: channel fees and ads on top of the margin you just priced.
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