What is a good Net Margin for e-commerce?

A healthy net margin is typically between 15-30%. Below 10% is risky, and above 30% is excellent.

The True Profit Simulator

Q: What is the difference between ROAS and True ROI?

ROAS only measures revenue vs. ad spend. True ROI accounts for ALL costs including COGS, shipping, payment fees, and agency fees.

Stop optimizing for vanity metrics. Calculate your actual Net Profit and True ROI by stress-testing your business model against real-world costs.

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check_circle No Login Required

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Load a Business Model

tune Inputs

Advanced Mode

Total Ad Spend ($)

Total Revenue ($)

COGS (Product Cost)

% of Rev Flat $

Net Profit

$0.00

True ROI

0.00%

Net Margin

0.00%

bar_chart Profit Waterfall

tune Sensitivity Engine

Simulate changes to stress-test your business model.

CPC Variation (Ad Spend Impact) 0%

-50% (Cheaper) +100% (Expensive)

Conversion Rate (Revenue Impact) 0%

-50% (Drop) +100% (Improve)

Who Is This Tool For?

Designed for modern e-commerce operators and marketers.

shopping_cart

DTC Brands

Calculate true blended margins.

local_shipping

Dropshippers

Protect thin margins from returns.

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Agencies

Show clients real profit, not just ROAS.

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Investors

Audit the health of an ad account.

Why ROAS is a Lie and Cash is King

The "Vanity Metric" Trap

If you are running digital ads today, you are likely obsessed with one metric: ROAS (Return on Ad Spend).

You log into Facebook Ads Manager, see a 4.0 ROAS, and celebrate. You spent $1,000 and made $4,000. It feels like printing money. But then you look at your bank account, and the cash isn't there. You struggle to pay inventory invoices. You can’t afford to hire that new agency.

Where did the money go?

The Hidden Costs eating your profit:

remove_circle Cost of Goods Sold (COGS)
remove_circle Payment Processing Fees (2.9% + 30¢)
remove_circle Returns & Refunds (Phantom Revenue)
remove_circle Agency / Management Fees

We built The True Profit Simulator to solve this problem. It bridges the gap between "Platform Metrics" (what the dashboard says) and "Business Reality" (what your CFO sees).

Frequently Asked Questions

What is the difference between ROAS and True ROI? expand_more

ROAS (Return on Ad Spend) only looks at Revenue divided by Ad Cost. It ignores product costs, shipping, and fees. True ROI accounts for ALL expenses to tell you the actual return on every dollar invested in the business, not just the ad platform.

How do I calculate Break-Even ROAS? expand_more

Break-Even ROAS is calculated as 1 / (Gross Margin %). For example, if your product has a 50% margin, your Break-Even ROAS is 2.0. If you get a 1.8 ROAS, you are losing money on every sale.

Does this tool save my data? expand_more

No. All calculations happen instantly in your browser. We do not store or see your financial data.

Stop Guessing. Start Profiting.

Use the simulator before every campaign launch to set realistic targets.

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