Etsy Pricing Formula: Price for a Target Margin
The formula to work backward from your desired profit margin to the exact listing price, accounting for every Etsy fee.
By Marginory team · Online sellers with hands-on experience across Etsy, Shopify & PODUpdated Fee data verified against official platform documentation
The formula
Price = (Product cost + Shipping cost) ÷ (1 − Target margin % − Etsy fee %)
This is a backward pricing formula — you decide your target profit margin first, then solve for the price that achieves it after Etsy's fees are deducted. It's more reliable than cost-plus markup because it accounts for fees being a percentage of the final sale price, not your cost.
Worked example
Product cost: $8. Shipping cost: $4. Target margin: 30%. Etsy fee: ~9.75% (no Offsite Ads).
Rounding to $19.99 leaves a small margin buffer above the 30% target.
Why cost-plus markup falls short
If you simply add 30% markup to your $12 cost, you'd price at $15.60 — but after Etsy's ~9.75% fee, your actual margin drops to roughly 21%, not 30%. The gap grows larger the more fees stack (e.g., with Offsite Ads active). The backward formula avoids this systematic underpricing.