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E-commerce

How to Calculate E-commerce Profit

8 min read · Updated 2026-06

Definition

E-commerce profit is what remains after every cost of selling online is subtracted from revenue. This formula works across all platforms.

Formula

E-commerce Profit = Revenue − Product Costs − Platform Fees − Payment Processing − Refunds − Shipping − Marketing − Operating Costs

Cost Breakdown by Platform

CostShopifyAmazon FBAWooCommerce
Platform fee$39+/mo$39.99/moFree (host ~$25)
Payment processing2.9%+$0.30Incl. in referral2.9%+$0.30
Referral15% avg
FulfillmentYou arrange$3–$6/unitYou arrange
Total platform cost3–5%25–35%2–4%

Common Mistakes

  • Comparing revenue without adjusting for fees. $100K on Amazon ≠ $100K on Shopify. After Amazon's 30% take you keep $70K vs $95K on Shopify.
  • Not factoring fulfillment costs. FBA is $3–6/unit. Self-fulfillment costs time. Calculate both.
  • Forgetting Amazon auto-approves returns. Your return rate will be higher on Amazon.

FAQ

Is the profit formula the same for all platforms?

The core formula is the same: Revenue − All Costs = Profit. Costs differ. Shopify: 2.9% + $0.30. Amazon: 15% referral + FBA. WooCommerce: lower fees but hosting costs.

What is the biggest profit killer in e-commerce?

The combination of small leaks. 5% refund rate, $3.50 shipping subsidy, $120/month apps, 3% payment fees — together 15–20% of revenue.

Should I calculate profit per order or per month?

Both. Per-order for pricing. Monthly for business viability.

What about inventory costs?

Inventory ties up cash but is not a direct cost until sold. $20K in dead stock is $20K not working for you.

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