Dropshipping Profit Calculator
Stress-test your profit per order after product, platform, processing, and ads — the line item that kills dropshippers.
Written by Dorothy Ibrahim, 10+ years in banking & finance
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How we calculate this
This calculator stress-tests the thin margins that kill dropshipping stores: it computes profit per order after supplier cost, platform fees, payment processing, ad spend, and refund drag, then shows your break-even ROAS and break-even CPA — the most you can pay for a customer before every order loses money. A stress panel reruns the numbers with CPC up 25%, conversion down 25%, and refunds doubled.
The formulas
- Contribution before ads (gross per order)
- sale price − supplier cost − platform fee − processing feeProcessing fee = sale price × processing rate + fixed fee (default 2.9% + $0.30).
- Refund drag per order
- refund rate × sale price − (refund rate × supplier cost, if the supplier refunds you)A refund gives back the revenue but keeps the ad cost you already paid.
- Net profit per order
- contribution before ads − ad cost per order − refund drag
- Break-even ROAS
- sale price ÷ contribution before ads
- Break-even CPA
- contribution before ads − refund dragThe ad cost per order that exactly zeroes your profit.
- Monthly profit
- net profit per order × orders per month
Worked example
- Say you sell at $40 with an $18 supplier cost, 3% platform fees, 2.9% + $0.30 processing, $10 of ad cost per order, a 5% refund rate (supplier does not refund you), and 400 orders/month.
- Platform fee = $40 × 3% = $1.20; processing = $40 × 2.9% + $0.30 = $1.46.
- Contribution before ads = $40 − $18 − $1.20 − $1.46 = $19.34.
- Refund drag = 5% × $40 = $2.00, so net per order = $19.34 − $10 − $2.00 = $7.34 — an 18.4% net margin, in the workable band (rule of thumb).
- Break-even ROAS = $40 ÷ $19.34 = 2.07, and break-even CPA = $19.34 − $2.00 = $17.34 — you are paying $10, so there is $7.34 of headroom.
- Monthly profit = $7.34 × 400 = $2,936.
- Stress test: CPC +25% ($12.50 ad cost) drops the order to $4.84; conversion −25% ($13.33 ad cost) drops it to $4.01; refunds doubled to 10% drop it to $5.34 — one bad month cuts profit roughly in half.
Rates, benchmarks & sources
- Default payment-processing rate — override with your processor’s actual schedule — Config: generic card-processing default (2.9% + $0.30)
- Dropshipping net-margin bands: under 8% fragile enough that one platform change wipes you out, 8–15% caution, above 15% workable — Rule of thumb
Figures current as of 2026-07-02. See our methodology & editorial standards for how constants are versioned and verified.
What this tool doesn’t model
- Ad cost per order is an average — real CPCs and conversion rates swing daily, which is exactly why the stress panel exists; it does not forecast your ad platform’s behavior.
- The refund model gives back revenue and keeps ad cost but ignores chargeback fees, return shipping, and customer-service time.
- Platform and processing percentages are flat inputs; if you sell on Shopify, use the Shopify Fee tool to get your exact all-in rate first.
- Ignores fixed overhead (apps, subscriptions, VAs, your own time) — a positive per-order profit can still be a losing business after overhead.
- Assumes every order has the same price and cost; a multi-product store should run its representative or weighted-average order.
Frequently asked questions
What is break-even ROAS and why does it matter more than my actual ROAS?
Break-even ROAS is the return on ad spend at which an order exactly covers its own product, platform, and processing costs: sale price ÷ contribution before ads. In the worked example that is 2.07 — any campaign returning less than $2.07 of revenue per $1 of spend loses money regardless of how good the ROAS sounds. Comparing your actual ROAS to this number, not to zero, tells you whether ads are actually profitable.
Why do refunds hurt dropshippers more than the refund amount suggests?
When an order is refunded you return the customer’s money, but the ad spend that bought that customer is already gone, and unless your supplier refunds you, the product cost is gone too. At the default 5% refund rate that quietly removes $2.00 from every order — spread across all orders, not just the refunded ones. Doubling the rate to 10% cuts the default profit from $7.34 to $5.34 per order.
What net margin does a dropshipping store need to survive?
As a rule of thumb, under 8% net margin is fragile — a single ad-cost increase, fee change, or refund spike can wipe out the profit; 8–15% is caution territory; above 15% is workable. These are heuristics for the dropshipping model, where you control neither the supplier’s costs nor the ad platform’s prices, so the margin has to absorb both.
How do I turn my CPC and conversion rate into ad cost per order?
Divide cost per click by conversion rate. At a $1.20 CPC and a 2% conversion rate you need 50 clicks per sale, so the ad cost per order is $1.20 ÷ 0.02 = $60. If that figure lands above the break-even CPA the tool shows, the campaign cannot be profitable at the current price and costs, no matter how the ads are optimized.
What does the stress panel actually test?
Three shocks that hit real stores: your CPC rising 25% (ad cost × 1.25), your conversion rate falling 25% (ad cost ÷ 0.75), and your refund rate doubling. Each is applied alone to your baseline numbers so you can see which lever your profit is most exposed to. If any scenario turns the order negative, your margin has no buffer for an ordinary bad month.
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themoneysheet provides educational estimates, not financial, tax, or legal advice. Figures use published rates and formulas current as of the date shown, but your situation may differ. Consult a qualified professional (CPA, attorney, or licensed advisor) before making financial decisions.