Ecommerce & Marketplaces
Net profit per unit
Every per-unit cost is subtracted from the selling price.
The Formula
Net = Price - COGS - Referral - Fulfilment - Ads - Other
Every per-unit cost is subtracted from the selling price.
| Symbol | Meaning | Unit | Notes |
|---|---|---|---|
| P | Selling price | currency | What the buyer pays per unit. |
| C | Product cost | currency | Supplier cost per unit. |
| R | Referral fee | currency | Amazon's percentage cut of the sale. |
| F | Fulfilment | currency | FBA fee plus inbound, or shipping to buyer. |
| A | Ad spend | currency | Pay-per-click cost per unit. |
| O | Other cost | currency | Returns, storage and any other charge. |
What Each Symbol Means
Pcurrency
Selling price
What the buyer pays per unit.
Ccurrency
Product cost
Supplier cost per unit.
Rcurrency
Referral fee
Amazon's percentage cut of the sale.
Fcurrency
Fulfilment
FBA fee plus inbound, or shipping to buyer.
Acurrency
Ad spend
Pay-per-click cost per unit.
Ocurrency
Other cost
Returns, storage and any other charge.
See It Worked With Real Numbers
A formula on its own does not tell you which number goes where. The how to calculate amazon profit page applies this equation to a concrete case, shows every intermediate step, and names the mistakes that produce a wrong answer even when the algebra is right.
Where This Formula Appears
This equation is the working core of How To Calculate Amazon Profit, filed under Business. Every number the guide produces comes from substituting into this one line.