E-Commerce Calculator Guide: Real Net Profit After All Costs
E-commerce profitability is layered — platform fees, shipping, ads, payment gateway fees, and returns all chip away at gross margin. Here's how to calculate your real net profit per product sold.
E-Commerce Profit Calculation
Break-Even ROAS
If non-ad costs total ₹650 on a ₹1,000 product: Break-even ROAS = 1,000 ÷ (1,000 − 650) = 2.86 (286%). Your ads must return at least ₹2.86 for every ₹1 spent just to break even.
Frequently Asked Questions
What is ROAS in e-commerce?
ROAS (Return on Ad Spend) = Revenue from ads ÷ Ad spend × 100. A ROAS of 400% means for every ₹1 spent on ads, you earn ₹4 in revenue. Break-even ROAS = Selling Price ÷ (Selling Price − Total Costs). If your margin is 30%, break-even ROAS = 100÷30 = 3.33 (333%).
What is net profit on an e-commerce sale?
Net Profit = Revenue − Product cost − Shipping cost − Platform fee − Ad spend − Payment gateway fee − Returns provision. E-commerce has many cost layers that erode margin. A product selling for ₹1,000 at 40% gross margin can easily have a net margin of 5–15% after all costs.
What are typical e-commerce platform fees?
Amazon India: 5–18% referral fee (category-dependent) + fulfillment fees (FBA). Flipkart: 5–18% commission + shipping. Meesho: 0–15% commission. Shopify: 0% commission + payment gateway ~2%. Instagram/Facebook Shops: 5% selling fee. Always check current fee schedules as they change.
What is a good e-commerce conversion rate?
Average e-commerce conversion rate: 1–3%. High-performing stores: 3–5%+. Mobile often converts lower (0.5–1.5%) than desktop (2–4%). Improving conversion rate is often more profitable than increasing traffic — doubling conversion doubles revenue from the same ad spend.
How do I calculate CAC (Customer Acquisition Cost)?
CAC = Total Marketing Spend ÷ Number of New Customers. If you spend ₹50,000 on ads and acquire 100 new customers, CAC = ₹500. Sustainable business requires LTV (Customer Lifetime Value) > 3× CAC. If average order value is ₹1,000 at 20% margin, you earn ₹200 per order — a ₹500 CAC only pays off after 2.5+ purchases.
Related Calculators
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Enter all cost layers to find true net profit, ROAS, and break-even for any product.
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