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ShipMargin

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    Methodology

    The main calculation methods and their assumptions. If a calculator gives you a number you did not expect, this page and the audit trail under the result should between them tell you exactly why.

    Adarsh Bora maintains the calculator software. The publication policy describes how we select sources, check arithmetic and handle corrections. A software check establishes the behaviour of an implementation; a carrier, marketplace or authority must still confirm the rule that applies to a shipment or sale.

    Volumetric and dimensional weight

    volume-derived weight = length × width × height ÷ divisor

    The combined weight tool uses native billing units independently of the input units: centimetres and kilograms for the DHL 5000 preset; inches and pounds for UPS US daily rates and USPS. These divisors are not exact unit conversions of one another. Presets cover the stated service context, not every carrier tariff worldwide.

    USPS rounds each measurement up to a whole inch before multiplying and checking the one-cubic-foot threshold. The nonrectangular engine mode applies the 0.785 factor before that check; the public postage worksheet assumes a rectangular bounding box and can overestimate tube dimensional weight. A 12-inch cube is at the threshold, so it is not subject to dimensional weight. USPS DMM 113 specifies the rule.

    Dated USPS postage tables

    The site integrates six tables from Notice 123 effective 12 July 2026: Ground Advantage, Priority Mail and Priority Mail Express, retail and commercial. They contain 431 weight bands across nine zones. Other carriers publish rate guides too; their prices are not integrated here.

    A lookup selects the next published weight band, applies supported surcharges and checks recorded size limits. Sub-pound actual weights remain unrounded until the table chooses its band. Identical parcels are priced separately, then multiplied; extra shipment-level charges are entered separately. Service comparisons show a per-parcel price. Negotiated rates, flat-rate packaging, cubic pricing, discounts and unsupported extras can produce a different invoice.

    The source PDF and its checksum are retained with the parser. Validation checks complete bands, nine zone prices per row, monotonic prices, plausible ranges and comparable commercial/retail prices. A reproducible parser check can detect drift from that stored edition; it does not prove a later edition has not been published.

    Chargeable weight and billing increments

    per piece = ceil(max(actual, dimensional) ÷ increment) × increment
    shipment weight = per piece × identical pieces

    The weight worksheet applies the increment to each piece before summing. UPS US and USPS presets use whole pounds; the DHL preset uses half-kilo increments up to 30 kg and whole kilos above as planning assumptions to check against your agreement. The postage worksheet instead selects the service's published bands, including sub-pound bands.

    Girth and length plus girth

    girth = 2 × (second-longest + shortest)
    length + girth = longest + girth

    The longest side is always the length, whichever field you typed it into, because that is how a carrier measures. We sort the three dimensions before applying the formula.

    Air freight and mode conversion

    Different modes convert volume to weight at different rates. The same cubic metre is billed as:

    Sea LCL revenue tonnes

    revenue tonnes = max(CBM, weight in tonnes)

    LCL is not billed on a divisor. It is quoted per revenue tonne — whichever is greater of one cubic metre or 1,000 kilograms. Because most consumer goods are less dense than that, LCL almost always bills on volume.

    Pallet and container packing

    We do not divide one volume by another. For each of the two base orientations of the carton footprint, we fill the main block, then pack the two leftover strips in the rotated orientation:

    main block   = floor(deckL ÷ a) × floor(deckW ÷ b)
    length strip = floor((deckL − nx×a) ÷ b) × floor(deckW ÷ a)
    width strip  = floor((nx×a) ÷ b) × floor((deckW − ny×b) ÷ a)

    The two strips do not overlap, and we take the better of the two starting orientations. This gives a geometric count under the entered dimensions, not a complete loading plan. Door access, stability, compression strength, orientation restrictions and handling clearances can reduce the practical count.

    Layers come from usable height divided by carton height, and the whole thing is then capped by the pallet or container weight limit if that binds first. We tell you which constraint bound.

    LTL freight class

    density = weight (lb) ÷ (L × W × H in inches ÷ 1728)

    Density in pounds per cubic foot maps to an NMFC class on the 13-tier scale introduced by NMFTA Docket 2025-1 on 19 July 2025. Measure the handling unit as loaded, including overhang and the pallet itself.

    Density is one of four NMFC factors. Stowability, handling and liability can move a class independently, so treat a calculated class as an opening position rather than a settled fact.

    Customs duty and import tax

    The sequence matters more than the rates, and it differs by country.

    customs value = goods + freight + insurance   (CIF countries)
    customs value = goods                         (FOB countries, incl. the US)
    
    duty          = customs value × duty rate
    levies        = per-country, applied to their own base
    taxable value = goods + freight + insurance + duty + levies   (typical)
    import tax    = taxable value × tax rate

    Import tax is charged on the value after duty in almost every country, so the two compound. Calculating them independently and adding the results understates the bill — the most common error we found in free duty calculators.

    India stacks three levies in a fixed order: basic customs duty on CIF, then social welfare surcharge at 10% of the duty (not of the goods), then IGST on the accumulated total.

    De minimis thresholds are tested against the goods value in the destination currency. If your input currency differs and you have not supplied an exchange rate, we say so and assume no relief rather than guessing.

    Marketplace fee stacks

    The fee base differs by marketplace and is a frequent source of error. eBay charges its final value fee on the item plus postage plus sales tax. Etsy charges its transaction fee on the item plus postage. Amazon charges the referral fee on the item plus shipping and gift wrap. Shopify charges no commission at all.

    Tiered categories step the rate at price points rather than applying one rate — Amazon's clothing category runs 5% at or below $15 and steps upward from there. Minimum fees and closing fees are applied after the percentage.

    Where a marketplace charges VAT on its own fees to non-registered sellers, that VAT is applied to the total of all marketplace fees, and it is not reclaimable.

    FBA profit with quoted fees

    The FBA worksheet is for the US marketplace in USD. Enter the fulfilment fee from your ASIN preview, including applicable surcharges, plus storage and other per-unit charges. We no longer infer a payable fee from a public reproduction of a size-tier table.

    Optional import mode calculates goods, freight, a user-supplied combined duty rate and shipment clearance per unit. That landed figure replaces cost of goods and inbound shipping. Returns use a conservative assumption of no marketplace fee refund. Account-specific rebates and reimbursements require reconciliation to your settlement.

    Storage planning

    Packaged cubic feet = length × width × height in centimetres ÷ 28,316.846592. Multiply by average units held, months and your quoted monthly rate per cubic foot. Ageing, utilisation and other surcharges are entered separately; the tool does not infer an age distribution from a single number of months.

    Profit, margin and break-even

    net revenue = price ÷ (1 + tax rate)   when the price includes tax
    net profit  = net revenue − platform fees − product costs − returns − advertising
    net margin  = net profit ÷ net revenue
    ROI         = net profit ÷ (COGS + inbound)

    Margin is measured against net revenue so it stays comparable across tax regimes. Commission is still charged on the gross price the buyer paid, because that is what marketplaces actually do.

    Return cost is spread across every unit sold, not per unit returned. Per return we count the handling cost, the refund administration fee, the proportion of stock that cannot be resold, the outbound fulfilment fee you do not get back, and whatever share of commission the marketplace keeps.

    Break-even price and target-margin price are solved numerically by bisection rather than algebraically. Fee schedules have tiers, minimums and floors, so a closed-form solution would break silently the moment we added one. The solver runs sixty iterations, which converges well inside a cent.

    Break-even ACOS

    contribution margin = net revenue − all costs except advertising
    break-even ACOS     = contribution margin ÷ price
    break-even ROAS     = price ÷ contribution margin
    max CPC             = contribution margin ÷ (100 ÷ conversion rate)

    Safety stock and reorder point

    safety stock  = z × √(leadTime × σ_demand² + demand² × σ_leadTime²)
    reorder point = demand × leadTime + safety stock
    EOQ           = √(2 × annual demand × order cost ÷ holding cost)

    Safety stock uses the statistical form, combining demand variability and lead-time variability, with z taken from your target service level — 1.645 at 95%. If you do not supply standard deviations we fall back to a buffer of 25% of lead time and say clearly that it is a rule of thumb rather than a service-level guarantee.

    Lead time includes warehouse receiving time, because stock sitting in a receiving queue is not sellable stock.

    Rounding and precision

    Money rounds half away from zero at two decimal places, which is what fee schedules assume. Rounding is done through exponent shifting rather than multiplying by a power of ten, so 1.005 rounds to 1.01 rather than to 1.00 — a binary floating-point artefact that quietly costs a cent in a surprising number of calculators.

    Weights are carried at full precision through the calculation and rounded only for display, so intermediate rounding never compounds.

    How this is verified

    The calculation engines are covered by a test suite that checks them against published worked examples: DHL's own 40 × 30 × 20 cm example returning 4.8 kg, the USPS 14 × 12 × 12 inch carton moving from 13 lb to 15 lb across the July 2026 divisor change, and the 12-inch cube correctly falling below the one-cubic-foot threshold, the UK VAT-on-duty sequence, India's three-levy stack, eBay's fee base including tax, and saved-scenario validation. Where our answer would differ from a carrier's published example, that is a bug and we would like to hear about it.