Calculate per-SKU profit by subtracting COGS, marketplace fees, shipping, advertising, and return costs from revenue. Build a full product P&L.
Understanding the true profitability of every product in your catalog is the foundation of a sustainable e-commerce business. Many sellers focus on top-line revenue while overlooking the many costs that erode margins — from marketplace fees and fulfillment charges to advertising spend and return handling.
This Product Profitability Calculator builds a complete per-SKU profit and loss statement. Enter your selling price, cost of goods sold, marketplace referral and fulfillment fees, outbound shipping costs, advertising spend per unit, and estimated return rate. The calculator then produces net profit per unit, profit margin percentage, and break-even units.
By analyzing profitability at the individual product level, you can identify which SKUs truly drive your bottom line, which ones break even, and which ones silently lose money with every sale. Use these insights to adjust pricing, renegotiate supplier terms, cut ad waste, or discontinue underperforming products. Whether you are a beginner or experienced professional, this free online tool provides instant, reliable results without manual computation.
Aggregate financials hide problems. A single loss-making SKU buried inside a profitable category can drain thousands of dollars per month without detection. Per-SKU profitability analysis gives you the granular visibility needed to make data-driven decisions about pricing, sourcing, and marketing investment. Having a precise figure at your fingertips empowers better planning and more confident decisions.
Net Profit per Unit = Selling Price − COGS − (Selling Price × Referral Fee %) − Fulfillment Fee − Shipping Cost − Ad Cost − (Selling Price × Return Rate % × Return Cost Factor) Profit Margin = (Net Profit / Selling Price) × 100 Monthly Profit = Net Profit per Unit × Monthly Units Sold
Result: $8.74 net profit per unit (29.1% margin)
From a $29.99 selling price, we subtract $8.50 COGS, $4.50 referral fee (15%), $5.25 fulfillment, $0 shipping, $3.00 ad cost, and $1.00 return cost (5% return rate × ~$20 cost per return). This leaves $8.74 net profit per unit. At 500 units per month the product generates $4,370 monthly profit.
While per-unit profit is essential, the full picture includes velocity. A product earning $2 profit but selling 1,000 units per month generates more total profit than a $10-margin product selling 50 units. Combine this calculator with inventory turnover and velocity metrics for a complete view.
Contribution margin excludes fixed costs like software subscriptions, warehouse rent, and salaries. Net profit deducts everything. Use contribution margin for short-term SKU decisions and net profit for overall business health.
As you scale, certain costs decrease per unit (bulk COGS discounts, amortized photography) while others increase (higher ad bids, more returns). Revisit this calculator at each growth milestone to ensure scaling hasn't silently eroded your margins.
COGS should include the product manufacturing or purchase cost, inbound freight to your warehouse or FBA, customs duties, and any prep or packaging costs incurred before the item is ready to sell. Do not include marketing or fulfillment costs — those are separate line items.
Divide your total advertising spend for that product over a period by the number of units sold in the same period. For example, if you spent $1,500 on PPC for a product that sold 500 units, your ad cost per unit is $3.00.
Healthy net margins after all costs typically range from 15% to 30%. Margins below 10% are risky because small fee increases or demand shifts can push products into loss territory. Premium or niche products may achieve 30%+ margins.
Yes. When a customer returns a product, you incur return shipping, restocking, and potential write-off costs. A common estimate is 20–50% of the selling price per returned unit. Multiply this by your return rate to get the per-unit return cost.
At minimum monthly, and immediately after any cost change such as supplier price adjustments, marketplace fee updates, or shipping rate changes. Quarterly deep dives help identify longer-term trends.
Negative profit means you lose money on every sale. Options include raising the price, negotiating lower COGS, reducing ad spend, improving conversion rates to lower ad cost per unit, or discontinuing the product.
Returns erode profit in multiple ways: you refund the full price, pay return shipping, incur restocking labor, and the returned item may not be resellable. A 10% return rate on a $30 product can reduce net margin by 3–5 percentage points.
Yes. Treat the bundle as a single SKU. Enter the bundle selling price and sum all component costs (COGS, packaging, assembly labor) into the COGS field. Fees and shipping should reflect the bundled item's actual charges.