Pure gross margin before ad spend and returns. The number you use to calculate break-even ROAS.
All calculations run in your browser. Nothing is sent to a server. Last updated: 2026-07-19 · Formula verified against published sources (see below).
Gross margin is profit per unit before ad spend, payment fees, and returns. It's the cleanest measure of product economics — the amount of money each sale generates to cover advertising, fixed costs, and (eventually) profit.
Use gross margin when comparing products, when calculating break-even ROAS, and when talking to investors. Use net profit when you want to know what actually hits your bank account.
Gross margin = selling price − COGS − shipping
Gross margin % = gross margin ÷ selling price × 100
This calculator does not include payment processing fees. Some calculators do; some don't. The break-even ROAS calculator on this site includes payment fees (use that one if you're computing ad thresholds).
The calculator also shows the implied break-even ROAS for this product: 1 ÷ gross margin %. This is the simplest possible break-even ROAS — it ignores payment fees. Use the full Break-Even ROAS Calculator for the more accurate number.
| Metric | Value |
|---|---|
| Selling price | $40.00 |
| Product cost | $15.00 |
| Shipping | $5.00 |
| Gross profit | $20.00 |
| Gross margin % | 50.00% |
| Implied break-even ROAS | 2.00× |
With payment fees included (use the full Break-Even ROAS Calculator), the number is closer to 2.16×. The 0.16× gap is what payment fees cost you.
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