Short answer: To make a 40% profit margin on a product that costs $12, after 10% platform and payment fees, sell it for $24.00 (or $23.99). The formula is price = cost ÷ (1 − margin − fees). For when to price by the item or the project, see Hourly vs. Project Pricing: Which Should Freelancers Use?.
Check our math
Here is the result above, step by step, using the numbers already filled in.
- What's left for cost1 − 40% margin − 10% fees = 50%
- Selling price$12.00 ÷ 50% = $24.00
- Profit (40%)$24.00 × 40% = $9.60
- Fees (10%)$24.00 × 10% = $2.40
- Check$24.00 − $12.00 − $2.40 = $9.60
- Markup on cost($24.00 − $12.00) ÷ $12.00 = 100%
- Sales for $1,000 of profit$1,000 ÷ $9.60 = 104.2 → 105
How this calculator works
Most underpricing comes from mixing up margin and markup. Margin is profit as a share of the selling price; markup is profit as a share of your cost. A 40% margin on a $12 item isn't $12 plus 40%; it's a 100% markup once fees are in.
The calculator starts from the price and works down: fees and your margin are both percentages of the selling price, so whatever is left has to cover the cost. Dividing the cost by that remainder gives the price.
Fees matter more than they look. Marketplaces and card processors take a share of every sale, so a 10% fee on a low-margin product can eat a third of your profit. Selling through your own store, or raising the price, are the two ways out.
Selling price by cost and margin
| Cost per unit | 30% margin | 40% margin | 50% margin | Profit per sale at 40% |
|---|---|---|---|---|
| $2.00 | $3.33 | $4.00 | $5.00 | $1.60 |
| $5.00 | $8.33 | $10.00 | $12.50 | $4.00 |
| $8.00 | $13.33 | $16.00 | $20.00 | $6.40 |
| $10.00 | $16.67 | $20.00 | $25.00 | $8.00 |
| $12.00 | $20.00 | $24.00 | $30.00 | $9.60 |
| $15.00 | $25.00 | $30.00 | $37.50 | $12.00 |
| $20.00 | $33.33 | $40.00 | $50.00 | $16.00 |
| $30.00 | $50.00 | $60.00 | $75.00 | $24.00 |
| $50.00 | $83.33 | $100.00 | $125.00 | $40.00 |
All prices include 10% platform and payment fees.
Worked examples
Printable templates
Each sale costs about 50¢ in file delivery and tools. Target a 70% margin with 8% fees.
| Result | |
|---|---|
| Price | $2.27 |
| Profit per sale | $1.59 |
| Sales for $1,000 profit | 629 |
Hand-poured candles
$7 of wax, wick, jar and label. Target a 45% margin on a marketplace taking 13%.
| Result | |
|---|---|
| Price | $16.67 |
| Profit per sale | $7.50 |
| Markup on cost | 138% |
Print-on-demand T-shirt on your own site
$14 for the printed shirt, a 35% margin, and about 3% in card fees because there's no marketplace cut.
| Result | |
|---|---|
| Price | $22.58 |
| Profit per sale | $7.90 |
| Sales for $1,000 profit | 127 |
Using your result
Start with the full cost of one unit: materials, packaging, any per-order fee, and the share of shipping you pay. If you make items in batches, divide the batch cost by the number of items. The "Not sure? Work it out" link under the cost field adds these up for you.
Next, pick a margin you can defend. Handmade and digital products often carry high margins because the buyer pays for design and time, not materials. Resold items usually have thinner margins. Check what similar products sell for; if your calculated price is far above the market, look at costs before margin.
Finally, check the volume. The "Sales for $1,000 profit" row tells you how many orders a month it takes to make the product worthwhile. If that number is out of reach, a higher price or a bundle usually helps more than more traffic.
Prices on a marketplace and on your own site can differ. If you sell in both places, run the calculator once for each fee level and decide whether to charge the same price everywhere or pass the higher fee on.
What it doesn't cover
- Shipping you charge separately, sales tax and returns aren't included.
- Flat per-order fees (for example a fixed amount per transaction) aren't a percentage; add them to cost per unit.
- Ad spend per sale isn't included. If ads bring most of your buyers, add the average ad cost per sale to cost.
- It gives the price that hits your margin, not the price buyers will pay. Check it against similar products.
Read more
Frequently asked questions
How do I price a product for profit?
Decide the margin you want, add the platform and payment fees, and divide your cost by what's left: price = cost ÷ (1 − margin − fees).
What's the difference between margin and markup?
Margin is profit divided by price; markup is profit divided by cost. In this calculator's example, a 40% margin is a 100% markup.
What price gives a 50% margin on a $10 product?
$25.00 with 10% fees, for a profit of $12.50 a sale.
How many sales do I need to make $1,000 of profit?
At $9.60 of profit per sale, 105 sales. The income goal calculator turns a daily or monthly goal into sales and visitors.
What profit margin should I aim for?
It depends on what you sell. Products where buyers pay for design or expertise, like templates or handmade goods, can carry high margins; resold or commodity items usually can't. Start with the margin you need to make the product worth your time, then compare the price with similar products.
Should I use charm pricing like $23.99?
It's common for products, and the calculator suggests one. It changes profit by a cent, so choose whatever fits how your buyers shop. For premium products, a round number often looks more confident.
Why is my price so much higher than my cost?
Because fees and margin are both taken from the price, not added to the cost. With 10% fees and a 40% margin, only 50% of the price is left to cover the cost, so the price has to be 2.0 times the cost.
Sources
This calculator uses only the numbers you enter; it doesn't depend on tax figures.
Updated October 2026 · By the NetTakeHome team. Estimates for planning, not tax, legal or financial advice.