Use this selling price calculator to estimate a product or service price from its cost and a target dollar profit, margin, or markup. You can also enter your shipping cost, the shipping amount charged to the customer, and a percentage commission fee.
Treat the result as a pricing estimate, not a guarantee of net profit. The calculator uses different formulas for each pricing mode, and its shipping and commission adjustments need to be checked against your actual checkout and fee structure.
How to use the selling price calculator
- Choose a calculation mode. Select “Selling price with target profit,” “Selling price with target margin,” or “Selling price with target markup.”
- Enter the cost of the product or service. Use the cost for one unit, one service, or one complete order. Keep every other amount on the same basis.
- Enter your target. Profit is a dollar amount; margin and markup are percentages. Enter 20 for 20%, not 0.20.
- Add shipping details. “Shipping Cost For Company” is what you pay. “Shipping Price For Customer” is what you charge. Enter zero where shipping does not apply.
- Enter the commission percentage. Use the percentage relevant to the transaction you are modeling. Enter zero if there is no percentage fee.
- Review the selling price and supporting results. Before publishing the price, reconcile the revenue, shipping, fees, and costs for a complete order.
The money fields are labeled in dollars. There are no separate inputs for taxes, fixed transaction fees, advertising, returns, or overhead. Account for relevant costs separately, or include appropriate per-unit costs in your cost input without double-counting them.
Profit, margin, and markup are different targets
- Dollar profit is the amount remaining after the costs included in your calculation.
- Margin expresses profit as a percentage of revenue.
- Markup expresses profit as a percentage of cost.
For example, with a $100 cost and no shipping or fees, a 20% markup produces a $120 selling price. A 20% margin requires a $125 selling price: the $25 profit is 20% of $125. Selecting the wrong mode can therefore produce a materially different price.
How this calculator calculates selling price
The following formulas describe the calculator’s current implementation. They are not interchangeable with a standard fee-adjusted retail pricing formula.
- C = cost of the product or service
- S = shipping cost for the company
- H = shipping price charged to the customer
- T = target dollar profit
- r = commission percentage divided by 100
- g = target margin percentage divided by 100
- u = target markup percentage divided by 100
First, define two intermediate amounts:
B = C + T + H − S
A = C + S + B × r
The calculator uses A for its common Total Costs result. Its selling price formulas are:
| Selected mode | Selling price formula |
|---|---|
| Target profit | B × (1 + r) |
| Target margin | A ÷ (1 − g) |
| Target markup | A × (1 + u) |
Important: the margin and markup formulas also reference the dollar-profit input through B and A, even though that input is hidden in those modes. Its configured default is $50. Those modes therefore do not depend solely on the visible cost and target percentage fields.
Use a margin below 100%. A 100% target makes the margin formula undefined; a higher percentage produces a negative price when A is positive.
Worked example using the configured inputs
Suppose product cost is $100, company shipping costs $5, customer shipping is $6.99, and commission is 15%. Using a $50 dollar-profit value in the formulas:
B = $100 + $50 + $6.99 − $5 = $151.99
A = $100 + $5 + ($151.99 × 0.15) = $127.7985
| Mode | Target | Calculated selling price |
|---|---|---|
| Target profit | $50 | $174.79 |
| Target margin | 20% | $159.75 |
| Target markup | 50% | $191.70 |
These prices follow the implemented formulas, with final amounts rounded to cents. They do not establish that an actual order will earn the stated target after all charges.
How to interpret the profit and cost results
The supporting outputs are calculated differently across modes:
- Target-profit mode: the displayed Profit repeats your requested dollar profit. It is not independently calculated by subtracting Total Costs from Selling Price.
- Target-margin mode: Profit equals Selling Price minus A. This gives the target margin relative to that internal cost base, but does not independently validate the commission charged on the transaction. The additional “Total Costs (margin)” output uses a separate formula and is not the same as A.
- Target-markup mode: displayed Profit uses C × (1 + u) + H − (C + S) × (1 + r), rather than Selling Price minus Total Costs. Its Profitability percentage also uses a different revenue base from the displayed Selling Price.
For these reasons, do not treat the displayed Profit or Profitability as verified net earnings. Also remember that a result can only account for costs represented in the calculation.
Check the price against your actual order economics
For an order with a separate shipping charge, verify:
Order profit = item price + customer shipping − product cost − company shipping − actual transaction fees − other applicable costs
Check whether your provider charges commission on the item price, shipping, taxes, or some combination. Adding a percentage to a price is not the same as retaining that amount after a percentage fee is deducted.
For example, if a 15% fee applies to the item price plus customer shipping, the item price needed for a fixed dollar profit is:
Item price = (product cost + company shipping + target profit) ÷ (1 − fee rate) − customer shipping
This is a separate verification formula, not the calculator’s target-profit formula. With the example above, it gives ($100 + $5 + $50) ÷ 0.85 − $6.99 = $175.36, rounded to cents, assuming no other costs.
Use the estimate to make a pricing decision
- Compare sales channels. Recalculate with each channel’s costs, then verify its actual fee rules before comparing expected profit.
- Evaluate free shipping. Set customer shipping to zero while retaining your shipping cost. Check whether the resulting price remains competitive and profitable.
- Test cost increases. Change product or shipping costs to see how much pricing flexibility you have.
- Recheck rounded or promotional prices. A price ending in .99 or a discount changes your realized margin. Recalculate profit using the final amount customers will pay.
A cost-based estimate is a starting point. Customer willingness to pay, competing offers, and sales volume also affect whether a price is commercially workable.
Related pricing calculators
- Use the Margin Calculator to examine profit as a percentage of selling price.
- Use the Markup Calculator to compare a selling price with its cost base.
- Use the Break-Even Point Calculator to estimate the sales volume needed to cover fixed and variable costs.
Need pricing estimates tailored to your business? Build a custom product pricing configurator with Calcopolis to apply your own shipping rules, fees, and product options when visitors request an estimate.