Understanding Marketplace Fees and Calculating True Profit

New resellers often celebrate the sale price. Experienced resellers celebrate net profit. The gap between the two can be surprisingly large.

The costs that add up

• Marketplace fees. Most platforms charge a percentage of the total sale, and some add a fixed per-order fee. Fees often apply to shipping charged to the buyer as well.
• Payment processing. Some platforms bundle this into their fee, others list it separately.
• Promoted listing fees. Optional advertising that charges an extra percentage when an item sells.
• Shipping label cost. What you pay the carrier, which may differ from what you charged the buyer.
• Supplies. Top loaders, team bags, bubble mailers, boxes and tape.
• Your purchase cost, including any sales tax you paid.

The basic formula

Net profit = sale price + shipping charged − marketplace fees − promoted fees − shipping label − supplies − purchase cost.

ROI (return on investment) = net profit ÷ purchase cost. Margin = net profit ÷ total revenue.

Fees change, so verify them

Marketplaces update fee schedules regularly and fees often differ by category. Always confirm the current rate on the marketplace's official fee page before relying on any estimate. The FlipScout Profit Calculator lets you edit every fee value, so you can match the latest published rates.

A healthy habit

Before buying any item to resell, run it through the calculator using a conservative sale price. If the deal only works at the highest comp you found, it is probably not a deal.