Glossary
Base cost
Base cost is what the fulfilment provider charges you to produce one unit, before shipping, marketplace fees, or payment processing. It is the starting point of your margin, not the whole of it.
Pricing against base cost alone is the most common early mistake. A $5 base cost on a $18 sale looks like a 72% margin until shipping and marketplace fees land, at which point the real figure is closer to 31%.
Because shipping and fees are close to fixed per order, low-priced items carry the same overhead as high-priced ones. That is the arithmetic reason bundles and gift sets outperform cheap single items on the same amount of work.