Ecommerce Contribution Margin Calculator
Calculate contribution per order, contribution margin, and the monthly order volume needed to cover fixed costs or reach a profit target.
Order contribution
Monthly planning
See how much each order contributes toward fixed costs and profit
Use this calculator when gross margin alone is not enough and you want to know how much money each order leaves after variable costs.
Contribution per order is the amount left after costs that move with each sale, such as product cost, fulfillment, shipping, selling fees, and advertising.
That remaining contribution is what pays recurring fixed costs. Once fixed costs are covered, additional contribution becomes operating profit.
Contribution margin depends on which costs you classify as variable. Use the same cost definitions consistently when comparing products, channels, or months.
How the calculation works
The calculator separates variable order economics from monthly fixed costs.
Calculate variable cost per order
Product, fulfillment, packaging, shipping, other variable costs, selling fees, and optional advertising cost are combined.
Calculate contribution per order
Variable cost is subtracted from selling price to find the amount left for fixed costs and profit.
Calculate contribution margin
Contribution per order is divided by selling price to show the percentage of revenue left after variable costs.
Estimate monthly order requirements
If monthly fixed costs or a target monthly profit are entered, the calculator estimates the order volume needed to cover them.
Example contribution margin calculation
Suppose an ecommerce order has the following economics:
Variable cost per order is $41.10, leaving $18.90 of contribution per order. Contribution margin is 31.5%. About 159 orders are needed to cover $3,000 of monthly fixed costs, and about 265 orders are needed to cover those fixed costs and reach a $2,000 monthly profit target.
What each result means
Contribution metrics connect order-level economics with the fixed costs of running the business.
Contribution per order
The amount left after variable costs. This is what one order contributes toward fixed costs and, after those are covered, profit.
Contribution margin
Contribution per order expressed as a percentage of selling price.
Variable cost per order
The total of all order costs you classified as variable, including percentage selling fees.
Break-even orders per month
The estimated order volume needed for total contribution to cover the monthly fixed costs entered.
Orders needed for target profit
The estimated order volume needed to cover monthly fixed costs plus the target monthly operating profit.
Contribution margin questions
Common questions about using contribution margin for ecommerce planning.
Is contribution margin the same as gross margin?
Not always. Contribution margin subtracts the variable costs you define from revenue. Gross margin often focuses on cost of goods sold. The exact difference depends on which costs your business includes in each metric.
Should advertising cost be treated as a variable cost?
If acquisition cost changes with each order and you want contribution after advertising, include it. If you prefer to analyze contribution before acquisition, leave it out and evaluate advertising separately.
What should count as a fixed cost?
Use recurring costs that do not change directly with each individual order, such as software, rent, insurance, salaried staff, and other fixed overhead.
Why are break-even orders rounded up?
A fraction of an order cannot normally cover the remaining fixed cost, so the calculator rounds the required volume up to the next whole order.
Can contribution per order be negative?
Yes. If variable cost per order is higher than selling price, each additional order loses money before fixed costs are considered.