Shopify Unit Economics Calculator
All-in-one Shopify profitability calculator — profit margins, breakeven ROAS, cost breakdown with GST, shipping, ad tax, cancellation and return rates.
Product
Taxes & Fees
Marketing
Risk Factors
Formula
What is Unit Economics?
Unit economics measures the profitability of a single unit (product) sold. It accounts for every cost involved in selling that unit — not just the product cost, but taxes, packaging, shipping, advertising, cancellations, and returns.
Understanding unit economics is critical for Shopify sellers because it reveals whether each sale actually makes money after all real-world costs are deducted.
What This Calculator Covers
Unlike basic margin calculators, this tool includes the hidden costs that eat into your profits:
- Landing Cost (COGS): What you paid for the product including import duties
- GST / Sales Tax: Government tax on the selling price
- Packaging & Flyer Costs: Boxes, mailers, inserts, branded packaging
- Shipping Fee: Courier cost paid by the seller
- Ad Spend + Ad Tax: Marketing cost with platform fees (Meta charges ~8-15% ad tax in some regions)
- Cancellation Rate: Orders cancelled before fulfillment — you still pay for the ad click
- Return Rate: Products returned after delivery — you lose shipping both ways
How to Use Breakeven ROAS
Breakeven ROAS tells you the minimum ROAS your ads must achieve to avoid losing money on each sale. A lower breakeven ROAS means more room for profitable scaling.
- Breakeven ROAS below 2.0x: Excellent — you have wide margins for ad testing and scaling
- Breakeven ROAS 2.0x – 3.0x: Good — achievable with optimized campaigns
- Breakeven ROAS above 4.0x: Tight — consider improving margins before scaling ads