Business Success Skills

Creating A Profitability Calculator In Excel Or Google Sheets




A profitability calculator allows you to quickly analyze the profitability of any product in your Amazon FBA business. Follow this step-by-step guide to build your calculator:

1. Setup: Spreadsheet Layout

Column Structure

| Column | Description |
|---------------------|-----------------------------------------------------|
| A: Product Name | Name of the product. |
| B: Selling Price | Price at which the product is sold. |
| C: Product Cost | Cost of the product (COGS). |
| D: FBA Fee | Fulfillment by Amazon fee for pick, pack, ship. |
| E: Referral Fee | Amazon’s 15% referral fee. |
| F: PPC Cost | Advertising cost per unit. |
| G: Total Costs | Sum of all costs for one unit. |
| H: Net Profit | Revenue minus total costs. |
| I: Profit Margin | Percentage of selling price that is profit. |
| J: ROI | Return on investment (profit relative to COGS). |

Example Data Input

| A | B | C | D | E | F | G | H | I | J |
|------------------|--------|-------|--------|--------|-------|--------|--------|---------|---------|
| Stainless Bottle | 30 | 8 | 4.50 | 4.50 | 3 | 20 | 10 | 33.33% | 125% |

2. Add Formulas

Step 1: Calculate the Referral Fee

Amazon typically charges 15% of the selling price for most categories.

Formula for Column E:
[ E2 = B2 * 0.15 ]

Step 2: Calculate Total Costs

Add all the costs (Product Cost, FBA Fee, Referral Fee, PPC Cost).

Formula for Column G:
[ G2 = C2 + D2 + E2 + F2 ]

Step 3: Calculate Net Profit

Net profit is the selling price minus total costs.

Formula for Column H:
[ H2 = B2 - G2 ]

Step 4: Calculate Profit Margin

Profit margin shows the percentage of the selling price that is profit.

Formula for Column I:
[ I2 = \frac{H2}{B2} * 100 ]

Step 5: Calculate ROI

Return on investment measures profit relative to product cost.

Formula for Column J:
[ J2 = \frac{H2}{C2} * 100 ]

3. Formatting the Spreadsheet

Add Headers

  1. Highlight Row 1.
  2. Use Bold Text for column titles.
  3. Center-align text for a clean look.

Apply Conditional Formatting

  1. Highlight the Profit Margin and ROI columns (Columns I and J).
  2. Set rules:
  3. Green for values above 30% profit margin or 100% ROI.
  4. Red for values below 20% profit margin or 50% ROI.

4. Final Spreadsheet Example

| Product Name | Selling Price | Product Cost | FBA Fee | Referral Fee | PPC Cost | Total Costs | Net Profit | Profit Margin | ROI |
|-------------------|-------------------|------------------|-------------|------------------|--------------|-----------------|----------------|-------------------|---------|
| Stainless Bottle | $30 | $8 | $4.50 | $4.50 | $3 | $20 | $10 | 33.33% | 125% |
| Yoga Mat | $25 | $6 | $4.00 | $3.75 | $2 | $15.75 | $9.25 | 37.00% | 154.17% |
| Phone Stand | $15 | $4 | $3.50 | $2.25 | $1.50 | $11.25 | $3.75 | 25.00% | 93.75% |

5. Automate and Scale

Add Dropdown Menus for Easy Data Input

  1. Create a list of common FBA Fees and link them to a dropdown in Column D.
  2. Use a dropdown in Column F for typical PPC costs.

Integrate with Real-Time Data

  • Use Google Sheets’ IMPORTXML to pull Amazon fees or prices directly from product pages.
    Example formula:
    plaintext =IMPORTXML("URL", "//span[@class='a-price-whole']")

6. Evaluate and Optimize

Scenario Analysis

  • Adjust PPC cost (Column F) to see how ad spend affects profitability.
  • Simulate price changes (Column B) to find the optimal selling price.

Breakeven Price

To calculate the breakeven price, use:
[
{Breakeven Price} = {Total Costs} = G2
]

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