Analify AI
Free ecommerce calculators · Profit and pricing

Contribution margin calculator

See what one order really leaves after product cost, shipping, payment fees and the ad cost to get it, and how much ad cost an order can carry.

Example numbers. Replace them with yours.

USD
USD
USD
%
USD
Contribution per order
USD 14.26
Contribution ratio
23.8%
Monthly contribution
USD 7,130
Max ad cost per order
USD 29.26
Break-even ROAS
2.05×

What it calculates

Contribution margin is what an order adds to the business after every cost that comes with that order. Gross margin stops at product cost. Contribution margin also takes out shipping, payment fees and ad cost, so it is the number that tells you whether selling one more order helps or hurts.

How to read the result

A negative contribution means every order loses money, even before fixed costs. Max ad cost per order is your ceiling for cost per purchase in Meta or TikTok. Multiply contribution by monthly orders and compare with fixed costs to see if the month makes money.

Learn the metric:Contribution marginBreak-even ROAS

The formula

Contribution = Price − COGS − shipping − Price × fee % − ad cost
Contribution ratio = Contribution ÷ Price
Max ad cost per order = Price − COGS − shipping − fees
Break-even ROAS = Price ÷ max ad cost per order

Worked example

Example inputs

Selling price
USD 60
Product cost
USD 22
Shipping
USD 7
Payment fee
2.9%
Ad cost per order
USD 15
Orders per month
500

Results

Contribution per order
USD 14.26
Contribution ratio
23.8%
Monthly contribution
USD 7,130
Max ad cost per order
USD 29.26
Break-even ROAS
2.05×

What changes the result

Ad cost per order at five values. Every other input stays as in the worked example; the highlighted row is the example.

Ad cost per orderContribution per orderMonthly contribution
USD 7.50USD 21.76USD 10,880
USD 11.25USD 18.01USD 9,005
USD 15USD 14.26USD 7,130
USD 18.75USD 10.51USD 5,255
USD 22.50USD 6.76USD 3,380

Use your real numbers

Analify reads order value and product cost from Shopify, shipping from connected couriers and ad spend from your ad accounts, and calculates Blended Profit and break-even ROAS every day.

Analify already reads 5 of these 6 inputs live, from Shopify · Courier · Ad accounts

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Questions

What is contribution margin in ecommerce?

The money an order leaves after product cost, shipping, payment fees and the ad cost to acquire it. It is what is left to pay fixed costs and make profit.

How is contribution margin different from gross margin?

Gross margin only subtracts product cost. Contribution margin also subtracts shipping, fees and ads, so it is lower and closer to what you keep.

What is a good contribution margin?

One that covers your fixed costs at the order volume you can realistically reach. Use the break-even calculator to check that.

Do you store what I enter?

No. The calculation runs in your browser and nothing is sent to Analify.

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