Shopify profit margin calculator

Gross profit is $36 and gross margin is 60%. Take out a $6.50 shipping label, a $1.74 card fee and $18 of ad spend and the same item nets $9.76, which is a 16.3% net margin.

Every line, in the order the money leaves:

• Price and cost

  $60 charged, $24 paid to the supplier. Gross profit $36, gross margin 60%.

• Shipping you absorb

  $6.50 for the label on a free-shipping order.

• Card fee

  $1.74, at 2.9% of the $60 charged.

• Profit before ads

  $27.76. This is the figure your ad budget has to fit inside.

• Ad spend

  $18 attributed to the sale. Net profit $9.76, net margin 16.3%.

Type those five figures into the calculator at the top of this page and every line comes back the same, down to the $27.76. Nothing here is rounded to make a point.

The distance between 60% and 16.3% is three costs that never appear next to the price in your Shopify admin. I run a store doing around $5M a year, and this gap is the reason a good-looking product line can sit flat in the bank for a quarter. For the full order-level version, with returns and fixed costs folded in, see how to calculate net profit on Shopify.

Almost always because the products sold before their cost existed. Shopify's help page puts it plainly: profit is reported only for products and variants that had cost recorded at the time they were sold.

Five prerequisites decide whether you see anything at all:

• Costs do not backfill

  Shopify calls Cost per item static data, and says the profit reports are therefore only relevant to a specific point in time. A cost you type today does nothing for last month.

• Every variant carries its own figure

  Cost per item sits on the product or the variant, so a product in three sizes needs the number typed three times.

• An uncosted variant is left out, not zeroed

  Its sales vanish from the report instead of showing as pure profit. Shopify warns you may see a discrepancy between the net sales in your sales reports and in your profit reports, and this is what causes it.

• Gift cards are excluded

  Shopify says Cost per item does not apply to gift card products at all.

• Charge tax on this product hides the number

  Tick it and Shopify stops showing the profit and margin lines on the product page. That covers most physical goods. The reports still work; the figure just is not where you looked.

For a catalogue rather than one product, Shopify's product details help page points at two native routes: the bulk editor, where you add a cost column to the table and type down it, and the product CSV import, which carries a cost column of its own. The same page carries the gift-card and Charge tax rules. Neither route touches an order that already shipped.

So set the cost before the selling starts. It is the one part of this you cannot fix later.

Five things it does not do, so you know when to stop trusting it:

• One item at a time. It knows nothing about the other 400 products in your catalogue.
• The card fee is the rate you typed, not the fee Shopify charged. Only a Shopify Payments store has the real per-transaction figure recorded against the order.
• Returns are missing. A 6% return rate on the $60 item at $15 a return is $0.90 an order, over half the card fee.
• Rent, salaries, apps and your Shopify plan are left out deliberately. Fixed costs come off the month, never off one order.
• Nothing is saved. The figures live in this browser tab and go when you close it.

On that second one, the rate to type depends on your plan and the card the customer used. Every fee Shopify takes on a sale lists them, including the ones that only apply when you do not use Shopify Payments.

The gap all this leaves is the expensive one. These figures price a product. They cannot tell you which of last month's orders lost money, and that question needs your real order data.

Easy Profit Calculator does that job. Its free plan covers 100 orders a month and gives you net profit per order plus the negative-profit orders report.

Two things it will not do. It works on orders you have already taken, so it cannot price a product you have not sold yet. And ad spend only imports by itself from Google Ads, on the paid plans; on the free plan every ad cost is typed in.