How Marketplace Commissions and Deductions Are Calculated
How commission, shipping, service fees, VAT and returns combine in one marketplace order. A rate-free method to find your real net margin on any channel.
Marketplace commissions and deductions are the result of four items subtracted in sequence from the selling price: commission plus its VAT, shipping charges, fixed service fees and return-related loss. After those four are deducted and the product's own VAT is set aside, what remains is compared with your product cost; that is your net margin. This article gives no rates, because rates vary by marketplace, category and period. It explains the logic of the calculation; you plug in the values from your own agreement.
Why logic rather than rates?
Most sellers know "commission is such and such percent" and build their pricing on it. Then the settlement arrives lower than expected. The rate was not wrong; the calculation was incomplete. Commission is not the only deduction; without shipping, service fees, VAT and returns considered together, a product's real contribution stays invisible.
Memorizing rates is inadequate for a second reason: they change. Categories get reclassified, campaign periods arrive, marketplaces renew their agreements. A seller who understands the logic swaps in the new rate and carries on. Once you set up the sequence in this article, you run the same calculation for Trendyol, Hepsiburada, Amazon, N11 or any global marketplace. For a marketplace-specific walkthrough, see how to read a Trendyol settlement report.
The deduction items one by one
Commission
The marketplace's share of each sale. It is usually calculated on the VAT-inclusive price the customer paid, at a rate set per category. The critical point: commission is a service fee and is itself subject to VAT. The marketplace invoices you for the commission, and the VAT on that invoice also leaves your account. Do not treat the rate in the agreement as the amount you pay; add the VAT on the commission.
Shipping charge
If you ship through the marketplace's contracted carriers, carriage is deducted from your settlement. It varies by volumetric weight, destination and the current agreement. Shipping is also a VAT-bearing service. On some marketplaces, orders above a price threshold ship free for the customer but not for the seller; the charge still comes out of your payout.
Fixed service fees
Platform, transaction or handling fees charged per order or per item. Because they look small they are often ignored, yet on a low-priced product they can outweigh the commission itself. They carry VAT too.
The product's own VAT
Not a deduction but the tax you remit to the state; it must nevertheless be separated in any net-margin calculation. The VAT inside the price the customer paid is not yours. The VAT on the commission and other deduction invoices is input VAT you can offset. That is why VAT-inclusive and VAT-exclusive figures must never be mixed in one calculation. Cross-border sellers should also account for the VAT or sales-tax regime of the destination market.
The return effect
When a return is approved, the sales amount is deducted from you and the commission usually comes back. Outbound shipping, return shipping and fixed fees mostly do not. Even when the item returns undamaged, the order closed at a loss. If the returned item is damaged, the loss grows by the product cost.
One order, step by step
The sequence below finds the net contribution of a single order on any marketplace. Take the values from your own agreement.
- Write down the selling price. The VAT-inclusive amount the customer paid. If a campaign discount applied, use the discounted figure; who funds the discount is defined in the agreement.
- Calculate the commission. Multiply the selling price by the category rate. Add the VAT on the commission.
- Add the shipping charge. What the marketplace deducts for this product's volumetric weight and destination, including VAT.
- Add the fixed service fees. All per-order and per-item fees, including VAT.
- Subtract the deductions from the selling price. What remains is the settlement the marketplace will pay you.
- Separate the product's VAT. The VAT inside the selling price is not yours; treat the VAT on deduction invoices as an offset.
- Subtract product cost. Purchase price, packaging and your warehouse's share of overhead. What remains is the gross contribution of one order.
- Weight the return loss. Know the product's return rate. Multiply the amount not recovered on a return (outbound shipping, return shipping, fixed fees, damage if any) by the return rate and subtract it from the gross contribution. What remains is the expected net contribution.
Once set up as a table, these eight steps run in seconds for any product. The hard part is keeping the values current.
The marketplace with the lowest commission rate is not always the cheapest marketplace. Once shipping and fixed fees are added, the ranking changes often.
Reading the calculation by product and by channel
The single-order calculation is instructive but not enough for decisions. The same product yields five different contributions on five channels, because commission rates, shipping agreements and fixed fees differ. A product that is profitable on Trendyol can go negative on Amazon. So read the calculation in three dimensions:
- By product. Which product contributes how much on which channel?
- By channel. What is the channel's total contribution after return loss?
- By price band. At what price do fixed fees and shipping wipe out the contribution on low-priced items?
The third dimension usually delivers the biggest surprise: products below a certain price make no money on any channel and must be bundled or delisted. To stay above that line, use the approach in the floor-price rule and loss prevention. Verifying the deductions against actual payouts is the subject of settlement and commission reconciliation.
Common calculation mistakes
- Calculating commission on the VAT-exclusive price. Most marketplaces use the VAT-inclusive price; the difference looks small but repeats on every order.
- Forgetting the VAT on commission. The contract rate is not the whole amount you pay.
- Averaging shipping charges. Volumetric weight differs per product; averages hide losses on heavy items.
- Treating returns as zero. In high-return categories this alone turns profit to loss.
- Booking the campaign discount on the wrong side. Did the marketplace fund it or you? Check the agreement before including it.
- Not updating a changed rate. A category change or a new agreement silently breaks the calculation.
How it works with Bulutegra
Bulutegra's profitability page applies the sequence in this article automatically for every product and every channel: commission model, VAT and return risk are deducted to show contribution per channel. The price matrix holds list, selling and floor prices per product per channel; the floor is derived from this calculation, and an update that would drop below it never reaches the channel. The campaign calculator shows where a discounted price takes the contribution before you join a promotion. The settlement and reconciliation screen compares the deduction you calculated with what the marketplace actually deducted; returns without commission credit and orders that went negative are listed separately. During shadow mode at setup, the system only reads; you hand over once you have seen the numbers match your own.
To see your products' real contribution per channel, request a demo or get a quote.
Frequently asked questions
Is marketplace commission calculated on the VAT-inclusive price?
On most marketplaces commission is calculated on the VAT-inclusive price the customer paid, and the commission itself is subject to VAT as a service. That is why the rate on paper and the amount leaving your pocket differ. The exact treatment varies by marketplace, so check the calculation definition in your agreement.
Is the commission refunded when an order is returned?
As a rule the commission is credited back once the return is approved, but shipping charges and some service fees usually are not. A returned order therefore closes at a loss, not at zero. On products with a high return rate you cannot calculate profitability without pricing in those unrecovered items.
How do I calculate my net margin on a marketplace?
From the selling price, deduct in order the commission and its VAT, the shipping charge, the fixed service fees; then separate the product's own VAT from what remains and subtract your product cost. Finally deduct the expected return loss weighted by your return rate. The sequence is the same on every marketplace; only the values change.
