Percentage of net revenue remaining as contribution margin (CM3) after all variable costs.
Contribution Margin % = ( Contribution Margin ÷ Net Revenue ) × 100
| Metric | Definition |
|---|
| Contribution Margin | Profit after COGS, fulfillment, transaction, marketing, and ad spend |
| Net Revenue | Revenue after discounts and refunds |
| Metadata | |
|---|
| Type | Percentage |
| Data Source | Shopify, Upstack Costs |
| Aggregation | Ratio |
Example
Your store generated $125,000 in net revenue with a 22.4% contribution margin in March:
| Month | Net Revenue | Contribution Margin | CM % |
|---|
| January | $98,500 | $19,700 | 20.0% |
| February | $112,300 | $24,706 | 22.0% |
| March | $125,000 | $28,000 | 22.4% |
How It Works
Contribution Margin % expresses Contribution Margin as a percentage of net revenue. It shows how much of each revenue dollar becomes profit after all variable costs—COGS, fulfillment, transaction fees, marketing costs, and ad spend. This percentage is your true marketing profitability rate.
When to Use
| Scenario | Action |
|---|
| Benchmark profitability | Compare CM % across periods to track margin trends |
| Evaluate marketing efficiency | Higher CM % means more profit per marketing dollar |
| Set pricing strategy | Ensure prices support target contribution margins |
| Compare channels | Identify which channels deliver the best margin |
| Metric | Relationship |
|---|
| Contribution Margin | The dollar amount (this metric’s numerator) |
| Net Revenue | The denominator for this calculation |
| Total Cost % | Inverse view—what percentage goes to costs |
| Marketing Cost % | Marketing spend as percentage of revenue |
