How it is calculated
The price is set so your margin survives fees charged on what the customer pays:
Margin method: P = (cost + fixed fee) ÷ (1 − margin − fees% × (1 + VAT)) Markup method: P = (cost × (1 + markup) + fixed fee) ÷ (1 − fees% × (1 + VAT)) Final price = P × (1 + VAT), then rounded- Margin is profit as a share of price; markup is profit as a share of cost. A 30% margin equals a 43% markup.
- After rounding, the real profit and margin are recalculated.
- Break-even = fixed costs ÷ profit per unit before fixed costs.
Worked example
A product costing 12 + 1 packaging + 5 shipping, fixed costs of 600 over 200 units a month (3 per unit), 30% margin, 2.9% + 0.30 payment fees: sell at 31.99, about 9.76 profit per unit (30.5% margin), break-even at 48 units and about 1,950 profit a month.
Frequently asked questions
How is this different from the profit margin calculator?
The margin calculator finds profit from a known price; this one finds the price you should charge from your costs and fees.
Should shipping be in the cost?
Yes if you pay it. If the customer pays shipping separately, leave it out.
Why end prices in 9 or .99?
Charm pricing makes prices feel lower and is common in retail. Choose “No rounding” if you prefer.