Lesson 2 of 5
Profit Margin
Turn raw profit into a percentage you can compare across products, months, and platforms.
~6 min
Margin lets you compare a $5 sticker to a $200 hoodie on the same scale. It is the single most useful number for deciding which products to keep, drop, or scale.
Profit margin
Profit margin (%) = (Profit ÷ Revenue) × 100
Healthy ranges
- Print-on-demand: 15–30% is typical
- Handmade: 30–50% if pricing is honest about your time
- Digital products: 70–90% after platform fees
Key takeaways
- Margin is profit ÷ revenue, expressed as a percentage.
- Use margin — not raw profit — to compare products of different prices.
Related Guides
- Profit guideBusiness PlanningHow To Calculate Handmade Business Profit
Work out what your handmade business actually keeps after materials, labor, packaging, shipping, fees, and taxes.
- Profit guideBusiness PlanningWhat Is A Good Print-on-Demand Profit Margin? Complete POD Profit Margin Guide (2026)
What a good POD profit margin looks like in 2026 — gross vs net margin, every POD cost, formulas, worked t-shirt/hoodie/mug/poster/tote examples, pricing tables, and common mistakes.
- Profit guideBusiness PlanningWhat Is a Good Profit Margin?
What counts as a healthy profit margin — and how it changes depending on what you sell and where.
Related Calculators
- CalculatorPrint-on-DemandProfit Margin CalculatorUniversal profit, margin, and markup for any product or channel.Open calculator →
- CalculatorBreak-Even CalculatorSales needed to cover your startup costs.Open calculator →
- CalculatorProfit Margin Difference CalculatorCompare two prices or products by profit and margin.Open calculator →
Help Me Decide
Troubleshooting
Recommended Downloads
- ResourceWorkbookSeller Profit WorkbookTrack revenue, expenses, fees, profit margins, break-even points, and product performance across any online selling business.Open resource →
- ResourceWorksheetTikTok Shop Profit WorksheetA beginner-friendly worksheet for estimating TikTok Shop fees, costs, and profit per product — plus monthly sales targets and break-even checks.Open resource →
- ResourceWorksheetBreak-Even Planning WorksheetCalculate break-even points, profit cushions, and sales targets across any selling platform.Open resource →
Continue Learning
- Courseuniversal-sellerReturns & Refunds for SellersWhat a return actually costs, which resolution to choose, and when returns become a profit problemOpen course →
- CourseShopifyYour Own Online StoreA channel decision made on your numbers, and a store built to launchOpen course →
- CoursehandmadeHandmade & Craft FairsOne product priced from real costs, and one event planned as a business decisionOpen course →