Work backwards from the fee, not forwards from the cost
"My cost is $10, so $12 gives me 20%" misses two things. First, selling fees are charged on the selling price, not on your cost. Second, margin is normally quoted against the price, not against cost. So a minimum price is found by dividing, not adding: total cost / (1 - fee rate - target margin). The result is rounded up to the cent so rounding never eats into the margin you asked for.
Total cost should include more than the invoice from your supplier: packaging and shipping per unit, and an allocation of fixed costs. That allocation is monthly fixed costs divided by the units you expect to sell. Including it is what stops you from setting a price that only covers variable costs and leaves rent and payroll unpaid.
The results show margin on price alongside markup over total cost, because the two are different numbers on different bases - worth confirming which one a buyer or supplier means. Prices here are pre-tax: US sales tax is added at checkout and varies by state and locality, so it is not built into the figures.
Written as of September 2026. Advertising, returns and coupon costs are not included, so real margins usually land lower. Use this for planning and confirm pricing and tax treatment with your accountant.
Frequently asked questions
Because margin is a share of the price. Adding 20% to a $10 total cost gives $12, but the $2 kept is only 16.7% of that price. To actually keep 20% of the price you need $12.50.
It is optional but safer. Leaving it at 0 produces a price that covers only variable costs, which will not pay rent or salaried payroll. If your volume forecast is uncertain, allocate over a conservatively low unit count.