Calculate your dropshipping profits by factoring in supplier costs, advertising expenses, shipping fees, platform costs, and payment processing fees. Determine net profit, profit margin, ROI, and per-unit profitability.
Cost from supplier for all units
Total ad spend for these sales
Total shipping cost to customers
Shopify, Stripe, PayPal fees
Dropshipping is a popular e-commerce business model where you sell products without holding inventory. While it offers low startup costs, understanding all expenses is crucial for profitability. This calculator helps you determine your true profit after accounting for supplier costs, advertising, shipping, platform fees, and payment processing.
Supplier Cost
The price you pay to your supplier for the product. This is typically the largest cost component in dropshipping.
Advertising Cost
Marketing expenses to drive traffic and sales, including Facebook Ads, Google Ads, influencer marketing, and other promotional costs.
Shipping Cost
Cost to ship products from supplier to customer. Some suppliers offer free shipping, while others charge per item.
Platform & Payment Fees
E-commerce platform fees (Shopify, WooCommerce) and payment processing fees (Stripe, PayPal) that reduce your revenue.
Understanding how to calculate your dropshipping profit helps you price products correctly and assess business viability:
Net Profit
Net Profit = (Selling Price × Units) - Supplier Cost - Advertising - Shipping - Platform Fees
The actual amount of money you keep after all expenses are deducted from your revenue.
Profit Margin
Profit Margin % = (Net Profit / Total Revenue) × 100
The percentage of revenue that becomes profit. Industry standard is 15-45%, with 20-30% being ideal.
Return on Investment (ROI)
ROI % = (Net Profit / Total Costs) × 100
Measures how efficiently you're using your investment. Higher ROI indicates better profitability.
Profit Per Unit
Per Unit Profit = Net Profit / Number of Units Sold
The average profit you make on each item sold, useful for comparing product profitability.
Profit margins vary significantly based on niche, product type, and business efficiency:
Low Margin (10-15%)
Competitive niches, high advertising costs
Average Margin (20-30%)
Ideal target for sustainable dropshipping
Good Margin (30-40%)
Well-optimized stores with strong branding
Excellent Margin (40%+)
Premium products, unique niches, strong brand
Underestimating Costs
Forgetting to account for all fees, returns, chargebacks, and hidden expenses
Competing on Price Alone
Racing to the bottom with low prices destroys margins and sustainability
Ignoring Customer Lifetime Value
Focusing only on first purchase instead of building repeat customer relationships
Poor Supplier Selection
Choosing unreliable suppliers leads to quality issues, delays, and customer complaints
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