Collect the matching inputs.
Use an income statement for a complete accounting period. Reconcile discounts, refunds, cost of goods, fulfilment, marketing, overhead, interest and tax under your accounting policy.
← All ecommerce KPIs
Profitability · Net marginProfit margin.
Profit margin.
Know what revenue leaves behind.
Net profit margin measures the share of net revenue left after all recognized expenses. It shows overall profitability, while gross and contribution margins answer narrower questions.
Start with your numbers.
Net margin calculator
01 / The definitionWhat is
What is
profit margin?
Net profit margin measures the share of net revenue left after all recognized expenses. It shows overall profitability, while gross and contribution margins answer narrower questions.
Gross margin excludes many operating costs. A product-level contribution margin should not be described as company net profit margin.
02 / The measurementA clear formula.
A clear formula.
A useful comparison.
Net margin =Net profit ÷ Net revenue × 100
Read the result in context.
Compare similar business models and consistent accounting treatment. Product mix, fulfilment model and growth investment can explain large differences.
Document the comparison.
Keep the reporting dates, population, exclusions and calculation with every result. Show underlying counts as well as the average or rate, so a small sample does not look more conclusive than it is.
Illustrative example
From inputs to insight.
- Net profit
- 8,000
- Net revenue
- 100,000
- Net margin
- 8%
8% net margin: €8,000 remains from €100,000 in net revenue after the expenses included in net profit.
Try your numbers ↑03 / Industry benchmarksContext first.
Context first.
Targets second.
Compare similar business models and consistent accounting treatment. Product mix, fulfilment model and growth investment can explain large differences.
Use the source’s population and measurement rules to decide whether the comparison applies to your store.
Retail net margins: business-model context
External context| Segment | Reported result |
|---|---|
| General retail · 23 firms | 5.61% |
| Grocery & food retail · 15 firms | 1.32% |
Source: NYU Stern industry margin data ↗. January 2026 dataset. Public-company industry aggregates include businesses beyond pure ecommerce. Accounting, scale and business model limit direct comparison with an individual online store.
04 / Clerk customer evidenceReal stories.
Real stories.
Clear measurement limits.
We have not verified a published Clerk customer case with a quantified profit margin result matching this page’s definition.
What would count as useful evidence?
A case reporting net profit and net revenue, with the time window and comparison method. General revenue growth or a related engagement metric does not establish this result.
Customer stories describe individual implementations. They are not industry benchmarks, guarantees or standardized causal tests.
05 / Put it into practice
Know what revenue leaves behind.
Evaluate promotions on their incremental contribution after discounts and delivery costs, then reconcile that contribution with overhead.
06 / Common questionsA little more
A little more
clarity.
How do I calculate profit margin?
Net profit ÷ Net revenue × 100. 8% net margin: €8,000 remains from €100,000 in net revenue after the expenses included in net profit.
What should I check before comparing results?
Gross margin excludes many operating costs. A product-level contribution margin should not be described as company net profit margin.
What is a good profit margin?
Compare similar business models and consistent accounting treatment. Product mix, fulfilment model and growth investment can explain large differences.
Does a higher attributed result prove incremental growth?
No. Attribution connects an interaction with an outcome under a reporting rule. To estimate what a change added, compare randomly assigned treatment and control groups using the same eligible population and a predefined measurement window.
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