Shopify Margin Calculator
Calculate your Shopify profit margin percentage for any product in your store. Enter your selling price and profit per unit to instantly see your margin and evaluate whether your product meets your profitability threshold. Margin percentage is the benchmark metric Shopify sellers use to compare product profitability across different price points and categories, and to determine if a product can sustain paid advertising campaigns.
How to Calculate Shopify Profit Margin
Shopify profit margin tells you what percentage of your selling price you keep as profit after all costs are paid. The formula is: Margin % = (Profit Per Unit ÷ Selling Price) × 100. Margin is the standard benchmark for comparing product profitability in ecommerce. Unlike ROI — which measures return on your cost investment — margin tells you how much of each sale flows to your bottom line. A product selling at $50 with $18 profit has a 36% margin, meaning you keep $0.36 of every $1.00 in revenue. Shopify sellers generally need at least 25–30% margin to sustainably run paid ads, absorb returns, and still generate meaningful profit. Use our Shopify Profit Calculator to calculate your profit per unit first if you haven't yet.
Frequently Asked Questions
What is a good profit margin for a Shopify store?
Healthy Shopify stores typically maintain 25–45% net margins. Below 20% is risky if you rely on paid ads, as advertising costs can easily wipe out thin margins. Physical products with low ticket prices often struggle to maintain strong margins after fees and shipping.
What is the difference between margin and markup?
Margin is profit as a percentage of selling price. Markup is profit as a percentage of cost. A product costing $10 sold for $20 has a 100% markup but a 50% margin. Ecommerce sellers typically use margin for pricing analysis.
Why does my Shopify margin matter for paid ads?
Your margin determines your maximum tolerable customer acquisition cost (CAC). If your margin per unit is $15 and your average ad cost per sale is $14, you're barely profitable. Most successful Shopify ad accounts aim for a CAC below 30–50% of the profit per unit to maintain healthy returns at scale.
Related Shopify Calculators
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- Shopify ROI Calculator
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- Shopify Product Profit Calculator
- Shopify Dropshipping Profit Calculator
See all tools on the Shopify Calculators hub page.
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Compare your Shopify margin with Amazon FBA margin:
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See all tools on the Amazon FBA Calculators hub page.
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