Aim for at least 20% net margin — below that, small cost changes or a bad ad month can wipe your profit entirely.
Factor in refunds. Ecom return rates typically run 5–15%. A 10% refund rate on a $50 product costs you more than just the sale — you're also absorbing shipping and processing fees twice.
Payment processing fees add up fast. At $30 AOV, a 2.9% + $0.30 fee is 3.9% of revenue — nearly double what it looks like on paper.
Gross margin is a ceiling, not a win. A 60% gross margin means nothing if your CAC eats 50% of revenue. Always calculate net margin with acquisition costs included.