What is the Ecommerce Unit Economics Calculator?
Ecommerce unit economics tell you whether each customer is profitable. Contribution per order = AOV − COGS − fulfilment − payment fees − returns; LTV = contribution × lifetime orders − retention marketing on repeat orders; and LTV:CAC compares that lifetime profit with what you paid to acquire the customer. A common benchmark is 3:1 or better.
Example: a $65 order with $20 COGS, $8 fulfilment, 3% fees and 5% returns contributes $31.80. At 2.4 lifetime orders and $2 of retention spend per repeat order, LTV is $73.52; against a $30 CAC that is 2.45:1 — profitable but tight. The first order alone pays back CAC (0.9 orders).
How to use the Ecommerce Unit Economics Calculator
- Enter Average order value, COGS per order and Fulfilment & shipping per order.
- Set Payment fees and Returns & refunds as percentages of order value.
- Enter your Customer acquisition cost (CAC) and Orders per customer (lifetime).
- Add Retention marketing per repeat order, then read LTV:CAC, contribution margin, LTV, first-order profit and orders to pay back CAC.
Why use AnyShift's Ecommerce Unit Economics Calculator
Popular use cases
- Preparing unit economics for investors or lenders
- Deciding how much to spend on acquisition
- Testing how a subscription or loyalty programme changes LTV
- Spotting products that only work if customers come back
Reading your LTV:CAC result
| LTV:CAC | What it means |
|---|---|
| Below 1:1 | Each customer costs more to acquire than they ever earn you |
| 1:1 to 3:1 | Profitable but tight; little room for rising ad costs |
| 3:1 or more | Healthy; room to keep investing in acquisition |
| Well above 5:1 | Possibly under-spending on growth |
For a marketing-only view across channels, try the LTV to CAC ratio calculator.
Frequently asked questions
What is a good LTV:CAC ratio?
Should LTV use revenue or profit?
What is CAC payback in ecommerce?
How do I estimate orders per customer?
How do returns affect unit economics?
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Last reviewed: Built for: United States, United Kingdom, Canada, Australia Part of Ecommerce & Sellers