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Shopify Profit Margin Explained: How to Know If Your Store Is Actually Making Money
Shopify profit margin is the percentage of revenue you keep after all costs. If you don’t calculate it correctly, you can scale revenue while losing money.
Many store owners look at revenue and assume growth equals success. In reality, profit margin is what determines whether your business is sustainable.
What counts as Shopify costs
- Product cost (COGS)
- Shipping and fulfillment
- Ad spend
- Payment processing fees
- Apps and subscriptions
Profit margin formula
Profit Margin = (Revenue - Total Costs) ÷ Revenue
A store doing $10,000 revenue with $8,000 costs has a 20% margin. That’s the number that matters.
Why most Shopify stores fail
They scale ads before understanding margins. They optimize for revenue instead of profit. They don’t track real costs.
Calculate your real profit
Use the ProfitHub Shopify Profit Calculator to see your real margins and stop guessing.
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