Dropshipping Profit Calculator
Dropshipping unit economics with advertising and refunds. Advertising cost per sale is the input that decides everything, and it is the one that rises as you scale.
Also called: dropship margin calculator, ecommerce unit economics.
$57.61 per order at a 3.84% net margin, or $17,281.50 a month on 300 orders. Advertising is 28.02% of the price, which is usually the input that decides whether this works.
How this is calculated
Supplier cost, shipping, payment fees and advertising all come off the price, and refunds remove revenue without returning the costs already incurred. The break-even ROAS shown is one over the contribution margin before advertising, which is the number to hold ad campaigns against. The structural difficulty is that ad cost per sale rises as spend increases, so a model that works at three hundred orders may not at three thousand.
refunds scale with the price while product and shipping costs do not come back- P
- Selling price
- r
- Refund rate
Method and limits
What it assumes
- A single product with a stable supplier price.
What it deliberately does not model
- Customer acquisition cost rises with scale, which a flat per-order figure hides.
- Long shipping times drive disputes, and the dispute rate here is an input rather than a prediction.
Formula version 1.0.0 · definition 1.0.0 · United States · Report a problem with this calculator
Frequently asked questions
- What margin does dropshipping need?
- Enough that advertising fits inside it. If product and shipping take sixty percent of the price, everything else must live in the remaining forty, and paid acquisition rarely does.