Profit margin: how to calculate it for each marketplace sale (with formula and example)

Profit margin is how much you keep from each real in sales after paying all the costs for that sale: margin = (price − sale costs) ÷ price × 100. A product sold for R$ 100 on Mercado Livre, with a 12% commission, R$ 14,95 shipping, 6% tax, a cost of R$ 40, and R$ 0,60 packaging, leaves R$ 26,45, a 26.45% margin. If you do the same calculation using only the product cost, you’ll get 60%. That gap is why a store can bring in plenty of revenue and still end the month with no money.

The formula is simple. The tricky part is knowing what to include. I’ll show you the formula, what counts as "sale costs" on a marketplace, and what margin you need to end the month with a profit.

#The profit margin formula

There are three ways to write the same calculation, and they all give the same result:

• In reais: profit per sale = price − sale costs.
• As a percentage: margin = profit per sale ÷ price × 100.
• In Excel: with the price in B2 and the costs in C2, =(B2-C2)/B2, with the cell formatted as a percentage.

Margin is always calculated based on the selling price. When you calculate it based on cost, it’s called markup, and the numbers look much higher. I explain the difference in markup: what it is and why it can be misleading.

#What goes into marketplace selling costs?

Anything that only exists because that sale happened. On Mercado Livre and Shopee, the minimum list is:

The example uses a 300-gram product, Classic with a 12% commission and green reputation, based on the official September 2026 shipping table. See the full calculation in how much you keep from a R$ 100 sale.

Note that this 26.45% margin still doesn’t account for paid listings, returns, or the store’s fixed expenses. It has a name: contribution margin. It’s how much each sale contributes toward paying for the rest of the operation. I explain the different layers in gross, contribution, and net margin.

#How margin changes with price

Margin isn’t a property of the product. It depends on the product’s price and sales channel. Here’s the same 300-gram item, with a cost of R$ 40, on Mercado Livre:

Two things stand out in this table. Margin grows much faster than the price because the product cost and shipping stay the same while revenue rises. And there’s a jump between R$ 78,99 and R$ 79: raising the price by one cent cuts profit by R$ 4,79 because the shipping cost moves to a different tier.

In practice. An automotive accessories seller told me he worked "with a 40% margin on everything." In his spreadsheet, margin meant price minus product cost, divided by price. When we recalculated it with commission, shipping, and tax, the average dropped to 17%, and his seven best-selling products, all under R$ 50, were between 3% and 8%. His formula wasn’t wrong. He was leaving things out.

#What margin do you need?

There’s no one right margin for everyone. There’s a minimum, and it depends on your operation.

Each sale’s margin needs to cover more than just the sale itself:

1. Paid listings, as a percentage of revenue. If you spend 8% of revenue on Mercado Ads or Shopee Ads, 8 percentage points of your margin are already spoken for.
2. Returns, which can wipe out the entire sale and sometimes the return shipping cost, too. A store with a 3% return rate loses roughly that much margin.
3. Fixed expenses: rent, salaries, software, accountant fees, and your own pay. Divide the month’s total by the month’s revenue.

Add the three together. That’s the minimum margin per sale needed for the store to make a profit. With 8% for Ads, 2% for returns, and 7% for fixed expenses, the minimum is 17%. Any product below that is being subsidized by the others.

For the reverse calculation—how many sales it takes to cover the month’s bills—see your store’s break-even point.

#Three mistakes that inflate margin

Calculating based on cost. A 50% margin and 100% markup describe the same product. If someone says "I make 100% on top," they’re talking about markup.

Forgetting the channel’s variable costs. Commission, shipping, and tax together take 25% to 45% of the price of a typical product. Leave any of them out, and your margin becomes a number that only looks good on paper.

Using the wrong purchase cost. If you bought the same product for R$ 32 in January and R$ 40 in September, today’s margin needs to use today’s cost or the average stock cost. Using the old purchase price inflates your margin without you noticing. I show the impact in the cost mistake that inflates your margin.

#How to calculate margin correctly

For one product, the formula is simple: subtract commission, shipping or fixed fees, tax, product cost, and packaging from the price, then divide by the price. To test different prices before changing a listing, the Milewa calculator uses the current Mercado Livre and Shopee tables.

For your entire store, margin needs to be calculated order by order, because the same product sells at different prices, with different promotions and shipping costs, throughout the month. Milewa does this using your actual orders: it applies the commission and shipping charged by the marketplace, your cost and tax, adds the Ads spend for each listing, and shows margin by order, product, and for the entire month. It also flags products below your minimum.