My platform takes commission on the price plus the shipping the customer pays; how do I adjust the calculation?
Work out the commission on the shipping the customer pays and add it to fixed fees. With 10% commission and customer-paid shipping of 20, you add 2 to fixed fees, and the price needed for a product costing 60 at a 20% margin rises from 85.71 to 88.57.
What the calculator assumes
The Selling-price calculator states in its assumptions that percentage fees are charged on the full selling price, and that the shipping you enter is shipping you pay. That holds in many cases. But some platforms take commission on the customer's whole payment, including the shipping they paid, which goes straight to the courier. You then pay commission on money none of which stays with you.
What ignoring it costs
Cost 60, commission 10%, margin 20%, and the customer pays shipping of 20 that goes to the courier.
Standard calculation: price 85.71, expected profit 17.14.
Reality: the platform takes 10% of 105.71, about 10.57 instead of 8.57, so profit falls to about 15.14 and the margin to about 17.67% instead of 20%.
On one order the gap is small, but it repeats on every order and grows as shipping gets dearer or commission higher.
The fix in three steps
- Multiply the commission rate by the shipping the customer pays: 10% of 20 = 2.
- Add the result to fixed fees, along with any other fixed fee.
- Leave the shipping field empty if the customer pays it, then solve.
The result is 88.57. At that price the platform takes 10% of 108.57, and profit is 17.71, which is 20% of the price as intended. This is not an approximation; it restores the exact answer, because commission on a fixed shipping charge is itself a fixed amount.
If shipping varies by city
If the customer pays 20 in one city and 30 in another, commission on shipping becomes 2 or 3. Use the higher figure if you never want the margin to slip on any order: with fixed fees of 3 the price becomes 90. Or use an average if you know how orders split. Confirm how commission is charged from your statement, then check the real margin on actual orders with the Profit margin calculator.
Common questions
What if commission is charged on the tax-inclusive price?
Same idea: work out the commission on the tax amount and add it to fixed fees.
Where do I find how commission is calculated?
In the platform's terms, or on a real order statement by comparing the commission with the item price alone and with price plus shipping.