← Guides · November 8, 2026
How to Price for a 40% Margin After Marketplace Fees
Adding 40% to your cost does not give a 40% margin, because fees and ads take a percentage of the price, not of your cost. Solve for the price instead:
price = (cost + your shipping + fixed fee − shipping charged × (1 − fee%)) ÷ (1 − fee% − ads% − margin)
Example on Etsy
Item cost $12, your shipping $6, shipping charged $5, fee 9.5% + $0.45, ads 5%.
- Break-even price: ($12 + $6 + $0.45 − $5 × 0.905) ÷ (1 − 0.095 − 0.05) = 13.925 ÷ 0.855 ≈ $16.29
- Price for a 40% margin: 13.925 ÷ (1 − 0.095 − 0.05 − 0.40) = 13.925 ÷ 0.455 ≈ $30.60
Check: at $30.60 the buyer pays $35.60, fees are $3.83, ads $1.53, and profit is about $12.24, which is 40% of $30.60.
Why it matters
Every extra point of fee or ads raises the price you need. Going from 5% to 15% ads moves the 40% target price from about $30.60 to $39.23, so test it before you scale ad spend.
The calculator shows break-even and target prices for each platform at once.