> ## Documentation Index
> Fetch the complete documentation index at: https://docs.upstackdata.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Contribution Margin %: Percent of Revenue as Profit

> Track what percentage of net revenue remains as contribution margin (CM3) after all variable costs. Calculate true marketing profitability.

<Tip>
  Percentage of net revenue remaining as contribution margin (CM3) after all variable costs.
</Tip>

## Formula

<Info>
  **Contribution Margin %** = ( **Contribution Margin** ÷ **Net Revenue** ) × 100
</Info>

### Formula Components

| Metric                                                                                       | Definition                                                           |
| -------------------------------------------------------------------------------------------- | -------------------------------------------------------------------- |
| [**Contribution Margin**](/reference/metrics/orders/contribution-margin/contribution-margin) | Profit after COGS, fulfillment, transaction, marketing, and ad spend |
| [**Net Revenue**](/reference/metrics/orders/revenue/net-revenue)                             | Revenue after discounts and refunds                                  |

| Metadata        |                                                                      |
| --------------- | -------------------------------------------------------------------- |
| **Type**        | Percentage                                                           |
| **Data Source** | [Shopify](/sources/shopify), [Upstack Costs](/sources/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    |

***

## Related Metrics

| Metric                                                                                   | Relationship                                |
| ---------------------------------------------------------------------------------------- | ------------------------------------------- |
| [Contribution Margin](/reference/metrics/orders/contribution-margin/contribution-margin) | The dollar amount (this metric's numerator) |
| [Net Revenue](/reference/metrics/orders/revenue/net-revenue)                             | The denominator for this calculation        |
| [Total Cost %](/reference/metrics/orders/contribution-margin/total-cost-percent)         | Inverse view—what percentage goes to costs  |
| [Marketing Cost %](/reference/metrics/orders/contribution-margin/marketing-cost-percent) | Marketing spend as percentage of revenue    |

[See all Contribution Margin metrics →](/reference/metrics/orders/contribution-margin)