Profit Margin Calculator
Calculate the profit margin and net profit for a product.
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The Ultimate Guide to Calculating Dropshipping Profit Margins
Profit margin is the most critical metric for any dropshipping business. It tells you how much profit you make for every dollar of revenue. A low margin can mean you're working hard for very little return.
Formula: `Net Profit / Revenue * 100`. Our calculator simplifies this by letting you input your costs individually.
Key Costs to Include:
- Cost of Goods Sold (COGS): What your supplier charges for the product.
- Shipping Fees: The cost to ship the item to the customer.
- Transaction Fees: Percentage-based fees from payment processors like Stripe or PayPal.
- Ad Spend: The specific ad cost to acquire this one sale (Cost Per Acquisition).