Lesson 4 of 5
ROI (Return on Investment)
The right way to judge ads, inventory buys, and tool subscriptions — without fooling yourself.
~6 min
ROI tells you what every dollar you spent gave back. It is the right lens for ads, bulk inventory orders, paid tools, and even courses.
Return on investment
ROI (%) = ((Return − Investment) ÷ Investment) × 100
Worked example
You spent $200 on Etsy Ads and the ads generated $500 in profit (not revenue — profit). ROI = ((500 − 200) ÷ 200) × 100 = 150%.
Key takeaways
- ROI = (return − investment) ÷ investment, as a percentage.
- Always feed ROI with profit, never revenue.
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)
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- 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
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