Know your real Amazon profit.

Ask a seller their margin and you usually get gross margin — selling price minus what the unit cost them. On a marketplace that number is close to meaningless. Between it and your bank account sit the referral fee, the closing fee, fulfilment, storage, the shipping you pay separately, the advertising that produced the sale, and the orders that came back.

Two of those get left out most often, and they are the two that move the answer furthest. Advertising is treated as a marketing line rather than a cost of sale, so it sits in a different mental column. Returns are treated as an occasional annoyance rather than a rate — in apparel and footwear the return line is routinely larger than the advertising line.

The result is consistent and expensive: a business that believes it runs at 28% and actually runs at 8%, priced and advertised as though the first number were true. Everything below is the arithmetic that closes that gap.

Start at the order. The settlement calculator itemises every per-unit charge for a given price and category — referral, closing, fulfilment, weight handling and storage — and returns the net figure that reaches your account.

It is the number to price against, and it is also the input everything else on this page needs. Guess the fee line and your margin, your break-even ACOS and your target ACOS are all wrong by the same amount.

Contribution margin is what remains of the selling price after product cost, fees and shipping — before advertising. It is the most useful single number in a marketplace business, and almost nobody is told the second thing about it: it is the same number as your break-even ACOS.

If 39% of the price is left, then an advertising cost of sale of 39% consumes it exactly, and every point below 39% is a point you keep. That identity turns an abstract margin figure into a bidding decision you can act on this afternoon.

The per-order view will not tell you whether the business is working, because it cannot see storage that accrues monthly, the advertising that ran across everything, or the returns that arrived from last month's orders.

The margin calculator takes the month as a whole: revenue against cost of goods, marketplace fees, shipping, advertising and returns, and shows what share of revenue each line consumed. The cost breakdown is usually more informative than the margin itself — it is rarely the line people came to check.

The single most common accounting error in marketplace selling is putting ad spend somewhere other than cost of sale. Margin computed before advertising is not your margin — it is your break-even ACOS, which is a genuinely useful number that just answers a different question.

TACoS is the check: advertising as a share of total revenue. Set it beside your net margin and the relationship is immediate — if TACoS is climbing toward your margin, advertising is consuming the business, and that can be true while every individual campaign still reports an acceptable ACOS.

A blended margin hides its own shape. A catalogue averaging 27% is often one strong product carrying several that lose money on every order, and the average will never say so.

The Business Report breaks revenue, units and conversion down by ASIN, which is the level at which margin becomes actionable — you cannot fix an average, but you can stop advertising one SKU.