Margin vs markup — which one should I use?

Margin, when deciding whether a product can afford ads and returns (it’s a share of what the customer pays). Markup, when setting prices from cost. A 100% markup is a 50% margin.

What margin do I need for dropshipping?

It depends on your ad costs and refund rate, not on a universal number. The chips here flag 50%+ as “room for ads” and 30–50% as “workable” as simple thresholds, not benchmarks.

Why is the target price “unreachable”?

Because target margin plus the fee rate is 100% or more — no price can satisfy that. Lower the target.

Are the defaults real products?

No. They’re an example so the tool isn’t blank; replace them with your own costs.

[ Free tool ]

Profit margin calculator

Margin and markup describe the same profit from two sides, and mixing them up is the most common pricing mistake in dropshipping. Enter your costs, see both, and get the price that hits the margin you want.

Selling price

Product cost

Shipping cost

Payment fees

Default 3% — typical card processing

Other cost per order

Packaging, apps, VA time

Target margin

We'll show the price that hits it

Defaults are an example product, not a benchmark. Replace them with your numbers.

Profit margin

Room for ads

54.1%

Gross profit as a share of price

Gross profit per order: $18.94
Markup on cost: 118%
All-in cost per order: $16.05
Price for 50% margin: $31.91

Price breakdown

54%

Margin

Gross profit54.1%
Product cost27.2%
Shipping12.9%
Fees + other5.9%

Margin is 54.1% of price; markup is 118% on cost — same profit, two different numbers.

Margin tells you if a product can work. Demand tells you if it will.

Majorka shows real order volume and competitor pricing for the products you're weighing up.

Check a product free

How it works

1
All-in cost = product + shipping + other per-order costs + payment fees (a percentage of price).
2
Gross profit = price − all-in cost. Margin = gross profit ÷ price. Markup = gross profit ÷ cost.
3
Target price solves price = fixed costs ÷ (1 − margin − fee rate), so the fee on the new price is already included.
4
Nothing here includes ad spend — use the break-even ROAS tool to see what margin leaves room for.

Margin tells you if a product can work. Demand tells you if it will.

Majorka shows real order volume and competitor pricing for the products you’re weighing up.

Check a product free

Frequently asked

Margin vs markup — which one should I use?: Margin, when deciding whether a product can afford ads and returns (it’s a share of what the customer pays). Markup, when setting prices from cost. A 100% markup is a 50% margin.
What margin do I need for dropshipping?: It depends on your ad costs and refund rate, not on a universal number. The chips here flag 50%+ as “room for ads” and 30–50% as “workable” as simple thresholds, not benchmarks.
Why is the target price “unreachable”?: Because target margin plus the fee rate is 100% or more — no price can satisfy that. Lower the target.
Are the defaults real products?: No. They’re an example so the tool isn’t blank; replace them with your own costs.

Señales de pedidos, actualizadas a diario

Tu próxima prueba de anuncios no tiene por qué ser un cara o cruz

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