Net Margin
The percentage of revenue remaining after all expenses — COGS, marketing, shipping, fees, and overhead.
Net Margin (%) = (Net Profit / Revenue) × 100What is Net Margin?
Net margin (also called net profit margin) is the ultimate measure of profitability. It shows what percentage of your revenue translates into actual profit after every single expense has been deducted — including COGS, shipping, marketing, payment processing fees, returns, and overhead.
Why Net Margin Matters for E-Commerce
Many e-commerce sellers focus on revenue or gross margin, but net margin reveals the true health of your business. A store doing $1M in revenue with a 3% net margin is making less profit than a store doing $200K with a 20% net margin.
Typical E-Commerce Net Margins
Most e-commerce businesses operate with net margins between 5% and 20%, depending on the industry, pricing strategy, and cost structure. Luxury goods tend to have higher margins, while commodity products often have thinner margins.
Your store generates $100,000 in revenue with $85,000 in total expenses. Net margin = ($15,000 / $100,000) × 100 = 15%.
Stop guessing. Start tracking.
Shopimize calculates your true e-commerce profit in real time.
Try Shopimize free →