Dropshipping Profit Margin Calculator

1. How to use this dropshipping profit margin calculator?

Finding the right price for your products is key to maximizing your profits in dropshipping. This free calculator helps you quickly estimate your potential revenue, costs, and profit margins so you can price your items with confidence.

Step 1: Enter your selling price per item
Input the amount of money you plan to charge customers for each item.

Step 2: Add the number of orders.
Estimate how many units you expect to sell.

Step 3: Input product costs per item
Include the base cost you pay your supplier for each product.

Step 4: Enter shipping fees per item
Add the shipping cost you will cover for each product sold.

Step 5: Include marketing fees (cost per acquisition)
Enter the average amount of money you have to pay to acquire 1 customer.

Step 6: Add any other fees (optional)
Include transaction fees, packaging costs, or any other expenses you have to pay for each item sold.

Step 7: Confirm the number of products.
By default, this is set to one, but you can freely adjust to as many products as you’re selling or planning to sell.

TrueProfit's dropshipping profit calculator tool isn’t just about crunching numbers—it’s about helping you price smarter. Use it to test different pricing strategies, validate your margins before listing a product, and ensure your dropshipping business stays profitable.

Best of all? It’s 100% free and you can use it as many times as you want to fine-tune your pricing and maximize your earnings.

2. What is dropshipping profit margin?

Dropshipping profit margin is the percentage of revenue you keep as profit after subtracting all costs (product cost, shipping, fees, and marketing).
It shows how much money you really earn for every $1 of sales in your dropshipping business.

3. What is dropshipping profit margin formula?

The dropshipping profit margin formula calculates the percentage of profit relative to your total revenue:

Profit Formula:

Profit = (Selling Price × Orders) - Total Costs

Profit Margin Formula:

Profit Margin = (Profit ÷ Total Revenue) × 100

For example:

You can do the math: 
Total Revenue = $50 × 500 = $25,000
Total Costs = ($15 + $5 + $10 + $2.50) × 500 = $16,250
→ Profit = $25,000 - $16,250 = $8,750
→ Profit Margin = ($8,750 ÷ $25,000) × 100 = 35%

4. What is a good dropshipping profit margin?

A good dropshipping profit margin typically ranges between 15% to 45%, depending on your experience and niche.

Here are some dropshipping profit margin benchmarks:

Some factors that affect profit margins are:

5. What is net profit and why should we track net profit?

Net profit is the amount of money a business keeps after deducting all expenses, including production costs, marketing, taxes, and operational fees, from total revenue. It shows the true profitability of your business—not just how much you’re selling, but how much you’re actually earning.

Tracking net profit is not nice-to-have, it’s a must for business owners because:

Measures true financial health – High revenue doesn’t guarantee profit. Net profit reveals if your business is genuinely making money.

Guides better pricing strategies – Tracking helps ensure your prices cover costs and leave room for sustainable profits.

Supports growth decisions – Knowing net profit allows you to reinvest wisely, scale operations, or cut unnecessary expenses.

Improves long-term sustainability – Continuous tracking highlights trends, showing whether profitability is increasing or declining over time.