Quick answer
Calculate contribution margin per order, subtract fixed costs/ads, then check net margin and break-even. Shipping charged and cost both belong in the P&L; free shipping must be baked into price.
Why it matters
Wrong order treats ad spend as extra and understates losses.
Shipping is subject to transaction fee.
Step by step
- Confirm price/shipping/materials/labor/packaging.
- Subtract listing/transaction/payment/offsite ads.
- Calculate net profit/margin before free shipping/discounts.
- Spot-check real orders; don't treat Etsy revenue as profit.
- Keep fee/refund/ad records for tax filing.
Common mistakes
- Treating Etsy revenue as profit.
- Omitting offsite ads/payment fixed fee/packaging.
- Free shipping not baked into price.
- Increasing ads while losing money.
Checklist
- Price/shipping/materials/labor/packaging confirmed.
- Listing/transaction/payment/ad fees deducted.
- Net profit/margin positive.
- Real-order spot check.
- Fee/refund/tax records kept.
Key facts
- Shipping is subject to transaction fee.
- Return postage is separate.
FAQ
How do I calculate Shipping?
Calculate contribution margin per order, subtract fixed costs/ads, then check net margin and break-even. Shipping charged and cost both belong in the P&L; free shipping must be baked into price.
How long does it take?
Usually 1-3 minutes; for intermittent issues, run 30 seconds and retest elsewhere.
Is data uploaded?
Runs locally and does not upload video/audio; extensions may still read the page.
Source: Etsy shipping