Calculating Your Margin Floor

Before you set any price, you need to know your floor — the number below which you are losing money on the transaction, not just margin.

Most sellers who get into price trouble do so because they never calculated this number. They set a price that feels competitive, then discover the payout does not cover what they spent.

What goes into your floor

For every listing, your real cost per sale includes four things:

Cost of goods

What you paid for the part — wholesale price, import cost, or acquisition cost. This is your base. Everything else adds to it.

Platform commission

Driwego's commission is deducted from every completed order. Factor this in before you set your price, not after you see your payout. If you are unsure of the current commission rate, check your payout breakdown — it is shown as Commissions Total on every payout statement.

Shipping cost

If you are absorbing shipping into your listed price rather than charging separately, the courier fee comes out of your margin. Know your typical shipping cost by weight and zone before pricing.

Handling cost

Packaging materials, time to pack, trip to the drop-off point. Small per transaction, but real. On high-volume, low-margin items they matter.

Add these four together. That is your floor. Any price you set must clear this number for the transaction to make sense financially.

Setting your price above the floor

The gap between your floor and your listed price is your margin. How much margin you need depends on your business — your overheads, your inventory financing, your reinvestment plans.

A general principle: do not price at your floor. A transaction at floor margin leaves no room for a discount, a return, a part that needs replacement, or an unexpected cost. Give yourself space. The sellers who grind at floor margin are the ones who eventually run promotions they cannot afford because they had no margin to discount from in the first place.

The quickest way to calculate your real floor: take your last ten completed orders, add up your actual costs for each one, and compare them to your payouts. The difference — divided by ten — is your current per-order margin. If you do not know this number, you do not yet know whether your pricing is working.