product profit margin calculator
An evidence-based profitability engine that calculates net margins, break-even ROAS, and economic risk for sellers.
$5
Works with the AI tools you already use
Claude Code
Cursor
Codex CLI
Muse
Dots+22 moreClaude CodeCursorCodex CLIMuseDots
OpenClaw
Manus
Grok
Grok Bot+18 agentsproduct profit margin calculator
Example session with this skill installed
I want to sell a portable blender for $45. My cost is $12. Shopify fees are 2.9% + $0.30. Shipping is $8 and packaging is $1.50. I expect to spend $10 on ads per sale. Is this profitable?
- Read your context and instructions
- Compiled the product profit margin
I have analyzed the unit economics for your portable blender. While the initial gross margin is strong, the high fulfillment and acquisition costs significantly narrow your net profitability.
Profitability Analysis
1. Decision Snapshot
The product is currently viable with a net profit of $11.89 per unit, but the business model is highly sensitive to advertising performance. With a break-even ROAS of 1.36, there is a reasonable buffer, but shipping costs represent nearly 18% of the retail price, which is a significant risk factor if rates rise.
2. Inputs & Assumptions
| Item | Value | Status |
|---|---|---|
| Selling Price | $45.00 | Verified |
| Unit Cost (COGS) | $12.00 | Verified |
| Platform Fees | $1.61 | Verified |
| Fulfillment/Shipping | $8.00 | Verified |
| Packaging | $1.50 | Verified |
| Marketing/CAC | $10.00 | Hypothesis |
| Return Rate | 5% | Unknown |
3. Economic Analysis
| Dimension | Score | Evidence | Why It Matters |
|---|---|---|---|
| Gross Profit | 5/5 | $33.00 margin | High ceiling for operating expenses. |
| Contribution Margin | 4/5 | 52% margin | Strong ability to cover fixed costs. |
| Net Unit Profit | 3/5 | $11.89 | Sufficient but vulnerable to CAC spikes. |
| Break-Even ROAS | 4/5 | 1.36 | Low threshold makes paid ads very feasible. |
| Discount Tolerance | 2/5 | Max 26% | Limited room for aggressive "Buy 1 Get 1" sales. |
4. Key Risks / Gaps
- Ad Spend Volatility: A $12 increase in CAC would wipe out all profit.
- Return Rate: Electronic items often see higher return rates than the 5% assumption.
- Shipping Weight: If the final packaged weight exceeds shipping tiers, the $8 estimate may fail.
5. Recommended Next Move
Primary Action: Run a small-scale "Ghost Ad" campaign to validate the $10 CAC hypothesis before ordering bulk inventory.
Supporting Actions:
- Get a final boxed weight/dimension to lock in the $8 shipping cost.
- Research category-specific return rates for small kitchen appliances.
Next steps
- Confirm the shipping tier with your 3PL or carrier based on total package weight.
- Calculate how a 10% return rate would impact your Net Unit Profit.
- Test three different ad creatives to find the baseline Cost Per Acquisition.
Connects securely to your tools. The creator never sees your data.
What you get
About this skill
The problem
Calculations for product profitability often ignore hidden costs like platform fees, packaging, and return rates. Sellers frequently struggle to determine their true break-even ROAS or how much discounting their margins can actually survive.
What it does
- Calculates net unit profit by factoring in selling price, COGS, platform fees, fulfillment, and marketing spend.
- Determines break-even acquisition costs and ROAS thresholds for digital advertising.
- Conducts sensitivity analysis on return rates and discount tolerance to find the limits of profitability.
- Generates an evidence ledger that separates verified facts from hypothetical assumptions to reduce risk.
- Produces a validation plan with specific tests to resolve high-impact uncertainties.
Why this beats prompting it yourself
General prompts often miss variable costs or provide flat calculations that don't account for risk. This skill enforces an evidence-based framework that scores your product's economic viability and identifies the specific data points that could break your business model.
Use cases
- Evaluating a new private label product for Amazon or Shopify before placing an inventory order.
- Auditing an existing product line to see how increased shipping costs affect the bottom line.
- Setting maximum bid limits for PPC campaigns based on hard break-even ROAS targets.
- Modeling the impact of a 20% off seasonal promotion on overall contribution margin.
How to install
Works the same in every agent - Claude, Cursor, Codex, Copilot and 20+ more.
- 1
Download the ZIP
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- 2
Unzip into your skills folder
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- 3
Ask your agent to use it
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