Profit Calculator
Most sellers calculate profit as selling price minus cost of goods - then wonder why the bank balance doesn't match. This calculator walks the full path a rupee actually takes: from MRP through your discounts to the price the buyer pays, through platform commission and TDS/TCS, through GST, through forward and return shipping (weighted by your real return rate), down to every per-unit cost including anything you want to add yourself. What's left at the end is your real net margin.
What each field means
- MRP
- The maximum retail price printed on the listing, before any discount.
- Discount on MRP
- The percentage discount shown to the buyer (or given to a marketplace) that turns MRP into your Average Selling Price (ASP).
- ASP (Average Selling Price)
- Calculated automatically as MRP minus the discount - the headline price before any further promo.
- Additional Discount on ASP
- A further deal, coupon, or promo percentage applied on top of ASP, if any - set to 0 if there isn't one.
- Discounted ASP
- Calculated automatically - the final price the order is actually settled at, and the base every fee and cost below is measured against.
- Platform Commission
- The marketplace or gateway's commission percentage, charged on Discounted ASP, plus 18% GST that most platforms charge on their own commission fee.
- TDS + TCS
- Tax deducted/collected at source, charged as a percentage of Discounted ASP alongside commission.
- GST Rate
- Your product's GST slab, used to back the GST component out of the price net of commission - GST collected from the customer isn't your profit, so it's removed rather than added.
- COGS % of ASP
- Auto-calculated from your Product Cost input - shows what share of Discounted ASP is eaten by cost of goods alone, before any fee, tax or shipping is even counted.
- Forward Shipping
- Your outbound shipping charge per order, plus 18% GST on that charge, plus any fixed platform fee and payment gateway fee.
- Return Shipping & Return Rate
- Your reverse-logistics charge per returned order (plus GST, fixed fee and payment fee) and the percentage of orders that come back - used to calculate the per-unit cost every order should absorb to cover returns.
- Return Cost (per unit)
- Defaults automatically to Return Shipping Total x Return Rate% from the Return Shipping tab - this is what should be taken per unit to absorb the return-shipping cost across all orders. Editable if you track this differently.
- Other Shipping Cost
- Any extra per-unit shipping cost not already covered - COD handling, insurance, doorstep exchange fees, and so on.
- Cost Inputs
- Every per-unit cost that isn't a fee or tax - product cost (COGS), marketing, stock-keeping, quality/finishing, brand royalty, and an Other Costs field for anything not listed, so no real cost gets left out of the math.
How to use the Profit Calculator
- Enter MRP and your discount percentage - ASP and Discounted ASP calculate automatically.
- Add your platform commission and TDS/TCS percentage, and your product's GST rate - 18% GST on the commission itself is added automatically.
- Switch to the Return Shipping tab, enter your return charges and return rate, and see the per-unit Return Cost it works out to. That figure auto-fills the Return Cost field below Forward Shipping - override it there if you want to use your own number.
- Add any Other Shipping Cost and fill in every cost in the Cost Inputs card - use Other Costs for anything specific to your business that isn't already listed.
- Read the margin verdict, the full P&L breakdown, and the cost waterfall on the right, then check the scenario comparison to see how a ±20% ASP change would move your margin.
The formula
Frequently asked questions
Why does this calculator start from MRP instead of just a selling price?
Because that's how pricing actually cascades in Indian ecommerce - MRP gets discounted to an ASP, sometimes discounted again by a promo, and it's that final Discounted ASP that commission, TDS/TCS and GST are all calculated against. Starting from MRP catches discount stacking that a single selling-price field would hide.
Why is GST applied to the platform commission?
Most marketplaces charge 18% GST on their own commission fee, on top of the commission itself - this calculator adds that automatically so the commission line reflects what actually leaves your payout, not just the headline percentage.
What is TDS/TCS and why is it deducted here?
Tax Deducted at Source and Tax Collected at Source are amounts marketplaces are required to withhold on your behalf under Indian tax law, deducted from your payout alongside commission - they reduce what actually reaches your account even though they're not a fee the platform keeps for itself.
How is Return Cost worked out, and can I change it?
By default it's Return Shipping Total multiplied by your Return Rate%, calculated in the Return Shipping tab - this spreads the return-shipping cost across every order, not just the ones that come back. The Return Cost field below Forward Shipping is editable, so you can override the default with your own figure at any time.
What should I put in "Other Costs"?
Anything real that doesn't fit the named fields above - quality-control rework, a percentage-based platform ads fee, insurance, storage overage charges, or any business-specific cost. It's subtracted from margin exactly like every other cost, so nothing gets left out of the true number.
Does this calculator include the GST I charge the customer?
No - GST collected from the customer is remitted to the government, not kept as profit, so it's backed out of the price rather than treated as income. The GST Rate field here isolates that component correctly rather than adding it as revenue.
What is a good net margin for an Indian ecommerce seller?
Most D2C and marketplace sellers target 15-30% net margin after every fee, tax and shipping cost - footwear and apparel often sit toward the lower end of that range because of higher return rates, which is exactly what the Return Cost field in this calculator is designed to surface.