Profit margin looks wrong: what to recheck
If margin looks wrong, check the denominator, missing ads, mixed currencies and the coupon price customers actually pay.
Steps
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Write the formula you think you used
Profit = price − landed cost − fees − fulfillment − ads − returns − other variable costs. Margin = profit ÷ price. If your sheet divided by cost, you reported markup.
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Convert everything into one currency
Use a dated FX rate. Convert landed cost, not only the factory quote. Do not subtract USD FBA from CNY COGS in the same column.
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Replace list price with paid price
Enter the coupon or deal price. Add ads and a returns allowance. If you fund a platform promotion, the model uses the net price.
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Re-run Profit Calculator and label the output
Read dollars and percent together. Save a named scenario. If margin still looks magical, you are still missing a line—raise the estimate, do not decorate the result.
Margin vs markup
Margin is profit ÷ selling price. Markup is profit ÷ cost. A 50% markup on cost is a 33% margin on price. If someone said “we need 30%”, ask which denominator they meant. CrossKit Profit Calculator outputs money; you divide by price for margin. Label the screenshot “after-ad margin on price”.
The usual missing lines
Ads, inbound freight, funded coupons, returns and FX buffers hide in “looks profitable” screenshots. Fee-only leftover is a fulfillment quote. Mixed CNY cost and USD fees in one subtraction is not arithmetic. Recalculate on the coupon price; inbound and FBA do not fall 15% when you take 15% off.
What the tool cannot invent
The calculator does not pull live payouts, does not show fake revenue, and is not an official marketplace fee engine. If the bank never sees the number, a line was omitted or the rate was a memory. Fix inputs; do not hunt for a higher “score”.
Related CrossKit tool
Profit Calculator
Open this browser tool after you read the article.
Frequently Asked Questions
Why did margin fall more than the coupon percent?
Because inbound, fulfillment and often ads did not fall by the same percent. Always recompute profit on the discounted price.
Is Shopify net payment my margin?
No. It is sales minus some processing, not minus COGS, ads or shipping you absorbed.
Does CrossKit show a “healthy margin” badge?
No. There is no invented rating. You decide whether after-ad contribution funds inventory risk.