Shopify profit margin calculator: what you keep per order

Your Shopify profit margin is what is left of each order after product cost, shipping, Shopify's payment fees, ads, your monthly apps and refunds, divided by the revenue you collect. This calculator uses Shopify's current US fee rates for your plan, then shows your net margin, profit per order, and the price you need to hit the margin you want.

How to use the Shopify profit calculator

Enter one typical order. Start with the price and any discount you usually give, plus shipping if the customer pays it. Then add what the order costs you: the product, shipping and packing, and your ad spend per order (last month's ad spend divided by last month's orders is fine).

Pick your Shopify plan and how the customer pays. The tool fills in the fee. If you use a payment provider other than Shopify Payments, choose "Third-party payment provider" and type in that provider's rate. Last, add your monthly plan and app bills and your monthly order count, so those costs get spread across each order.

How it works: the Shopify fees and the formula

These are the online payment rates Shopify publishes for US stores, checked today on Shopify's pricing page:

Plan	Standard card	Premium card	Third-party provider fee
Basic	2.9% + 30¢	3.5% + 30¢	2%
Shopify	2.7% + 30¢	3.3% + 30¢	1%
Advanced	2.5% + 30¢	3.1% + 30¢	0.6%
Plus	2.25% + 30¢	2.95% + 30¢	0.2%

International cards add 1% on every plan. The third-party fee is what Shopify charges on top of your own provider's fee when you do not use Shopify Payments. Rates differ outside the US, so check your own admin if you sell from another country.

Refunds matter more than people expect. Shopify says the original card fee is not returned when you refund an order (Shopify Help Center). So a refunded order still costs you the fee, the shipping and the ad that won it. The calculator assumes you restock refunded items, so product cost comes back.

Revenue (R)        = price x (1 - discount) + shipping charged
Payment fee        = R x fee % + fixed fee
Fixed per order    = monthly plan and app costs / orders per month
Refund loss        = refund rate x (R - product cost)

Net profit         = R - payment fee - product cost - shipping cost
                     - ads - fixed per order - refund loss
Net margin         = net profit / (R x (1 - refund rate))

Price for margin m: solve net profit = m x R x (1 - refund rate)
  R = (fixed fee + (1 - refund) x product cost + shipping cost + ads + fixed per order)
      / ((1 - refund) x (1 - m) - fee %)
  price = (R - shipping charged) / (1 - discount)
Break-even price is the same formula with m = 0.

Sales tax is left out because you collect it for the state and pass it on. It is not your revenue.

Worked example: profit on a $40 order

These are the example values filled in above. They are an illustration, not a benchmark.

Revenue:               $40.00
Payment fee (Basic):   $40 x 2.9% + $0.30   = $1.46
Product cost:          $12.00
Shipping and packing:  $6.00
Ads:                   $8.00
Plan and apps:         $100 / 200 orders     = $0.50
Refunds:               3% x ($40 - $12)      = $0.84

Net profit:  40 - 1.46 - 12 - 6 - 8 - 0.50 - 0.84 = $11.20
Net margin:  11.20 / (40 x 0.97) = 11.20 / 38.80 = 28.9%

Price for a 30% margin:
  costs  = 0.30 + 0.97 x 12 + 6 + 8 + 0.50 = 26.44
  divide = 0.97 x 0.70 - 0.029 = 0.650
  price  = 26.44 / 0.650 = $40.68
Break-even: 26.44 / (0.97 - 0.029) = 26.44 / 0.941 = $28.10

The product margin here looks like 70% ($28 on a $40 sale). After fees, shipping, ads and refunds, the store keeps 28.9%. That gap is why a margin worked out from product cost alone is misleading. Move to the Shopify plan and the fee drops to 2.7% + 30¢, saving 8¢ an order. At 200 orders that is $16 a month, far less than the difference in plan price, so for this store the plan change does not pay on fees alone.

What a good Shopify profit margin looks like, and what to do next

There is no single right number. It depends on your category, your price and how much you spend on ads. The useful test is whether your net margin leaves enough to cover the costs this tool does not see, like your own time, stock you cannot sell and returns you cannot restock.

• Below break-even: every order loses money. Raise the price, cut the ad cost per order or bundle products so shipping is spread over more revenue.
• Profitable but under target: look at the biggest line in the breakdown. It is usually ads or shipping. Our break-even ROAS calculator shows the most you can pay in ads per sale.
• Above target: test more ad spend in steps, and keep checking that the ad cost per order holds.

Often the fastest way to lift margin is getting more of your existing visitors to buy, because it lowers the ad cost behind each order. Start with Shopify conversion rate optimization, or if visits are coming in with no sales, work through the 11 things to check. You can also see what a full page-by-page review looks like in this example website sales fix report.

Questions people ask

How do you calculate profit margin on Shopify?

Take the revenue from an order and subtract product cost, shipping, Shopify's payment fee, ad cost, a share of your monthly plan and app bills, and refunds. Divide what is left by the revenue you keep. For example, a $40 order that leaves $11.20 after all costs, with 3% refunds, has a net margin of 11.20 divided by 38.80, or 28.9%.

How much does Shopify take per sale?

On the Basic plan in the US, Shopify Payments charges 2.9% + 30¢ for a standard online card payment. The rate drops to 2.7%, 2.5% and 2.25% on the Shopify, Advanced and Plus plans. Premium and international cards cost more. If you use another payment provider, Shopify adds its own fee of 2%, 1%, 0.6% or 0.2% depending on plan.

What is the difference between margin and markup?

Margin is profit as a share of the selling price. Markup is profit as a share of the cost. A product that costs $12 and sells for $40 makes $28: that is a 70% margin and a 233% markup. Both describe the same sale. Margin is the number to watch when you plan pricing, because fees and ads are charged on the price.

Does Shopify refund transaction fees when I refund an order?

No. Shopify's help center says the original card fee is not returned when you issue a refund, though the refund itself does not add a new fee. That is why a high refund rate cuts margin twice: you lose the sale and still pay the fee, the shipping and the ad that brought the order in.

Is it worth upgrading my Shopify plan to save on fees?

Only if the fee savings cover the higher plan price. Multiply your monthly revenue by the difference in card rate. On the example store, moving from Basic to Shopify saves 0.2% on $8,000 of monthly revenue, about $16 a month. That is far less than the extra plan cost, so for smaller stores other features usually decide it.