“I made $500 in sales this month!”
Cool. How much did you actually profit though?
This is where most resellers get uncomfortable. Because when you actually add up all the fees, shipping costs, packaging materials, and random expenses, that $500 month might really be a $150 month. Or worse.
Let’s break down every cost that eats into your flipping profits so you can finally know your real numbers.
The Big Three: Platform Fees, Shipping, and Payment Processing
These are the costs everyone sort of knows about but rarely calculates accurately.
Platform Fees by Marketplace
Every platform takes a cut. Here’s what you’re actually paying:
eBay
- Final Value Fee: 13.25% for most categories (some categories are higher or lower)
- This is calculated on the total amount including shipping
- Additional $0.30 per order
- So a $50 sale with $10 shipping = $60 total, and eBay takes about $8.25
Poshmark
- Flat 20% commission on sales over $15
- Flat $2.95 on sales under $15
- At least shipping is prepaid and simple
Mercari
- 10% selling fee
- Plus payment processing (2.9% + $0.50)
- That’s effectively 13%+ on most sales
Facebook Marketplace (Shipped)
- 5% fee (minimum $0.40)
- Not bad, but buyer pool can be smaller for shipped items
Depop
- 10% selling fee
- Plus payment processing fees
- Similar to Mercari at around 13% total
Local Sales (FB Marketplace, Craigslist, OfferUp)
- 0% fees
- But you’re spending time meeting people and dealing with no-shows
Shipping Costs
This is where profits go to die if you’re not paying attention.
Typical shipping costs for common items:
- Small flat items (t-shirts, books): $4-6 via USPS First Class
- Medium clothing (jeans, sweaters): $8-10 via Priority Mail
- Shoes: $10-14 via Priority Mail
- Heavy items (coats, boots): $12-18 via Priority Mail
- Large items (vintage electronics, home goods): $15-30+ depending on size and weight
If you offer free shipping (which often helps items sell faster and for more), these costs come directly out of your profit.
If buyer pays shipping, your item might sell slower or for less. Pick your poison.
Payment Processing
Even after platform fees, getting paid costs money:
- PayPal: 2.9% + $0.30 per transaction
- eBay Managed Payments: Built into their fees now
- Stripe/Other processors: Usually 2.9% + $0.30
This is on top of platform fees, and people forget about it constantly.
The Hidden Costs Nobody Talks About
Platform fees and shipping are obvious. These next ones sneak up on you.
Packaging Materials
Every item you ship needs:
- Poly mailers: $0.20-0.50 each depending on size
- Boxes (for shoes, fragile items): $0.50-3.00 each
- Tape: Adds up over hundreds of packages
- Tissue paper (if you’re doing nice packaging): $0.10-0.25 per item
- Thank you cards: Optional, but $0.05-0.15 each
- Labels: Negligible but not zero
Budget about $1-3 per item shipped. That doesn’t sound like much until you realize it’s $300-900 per 300 items sold.
Sourcing Costs
Getting inventory isn’t free either:
- Gas to drive to thrift stores, garage sales, estate sales
- Admission fees at estate sales (often $0-5)
- Sales tax on purchases (usually 6-10%)
- Auction buyer premiums (often 10-20% at estate auctions)
That $10 thrift store find is really $10.80 after tax. Drive 20 miles to get it and you’ve added another $2-4 in gas. Now it’s a $13-15 acquisition cost.
Supplies and Equipment
One-time and ongoing costs:
- Photography setup: Lighting, backdrop, mannequin ($50-300)
- Steamer or iron: For clothing ($20-50)
- Cleaning supplies: Stain removers, shoe cleaners, etc. ($20-50/year)
- Measuring tape: For listing dimensions ($5-10)
- Scale: For accurate shipping weights ($20-40)
- Printer: For shipping labels ($50-150 plus ink)
- Phone/Camera: You probably already have this
- Storage: Bins, racks, hangers ($50-200+)
If you’re just starting, this stuff adds up fast. Budget at least $200-500 to get set up properly.
The Time Cost
This isn’t a dollar cost, but it’s real:
- Sourcing: 3-4 hours per sourcing trip
- Cleaning/Prep: 5-15 minutes per item
- Photography: 5-10 minutes per item
- Listing: 10-15 minutes per item
- Customer service: Messages, questions, issues
- Packing: 5-10 minutes per order
- Shipping: Trip to post office or scheduled pickups
A conservative estimate: 45-60 minutes of work per item from sourcing to shipped.
If your average profit per item is $15, you’re making about $15-20/hour. Not bad, but not as lucrative as that $500 month sounds.
Returns and Issues
Nobody likes talking about this, but returns happen:
- Return shipping: Sometimes you eat this cost
- Restocking/Relisting: Time spent dealing with it
- Damaged returns: Item comes back in worse condition
- Refunds: Sometimes you just lose the sale entirely
Budget 3-5% of your sales for return-related losses. On a $500 month, that’s $15-25 you might not see.
Platform-Specific Gotchas
Each platform has its quirks:
eBay
- Promoted listings fees (if you use them): Additional 2-10%+
- Store subscription: $7.95-$349.95/month depending on tier
- Listing upgrade fees (bold, subtitle, etc.)
Poshmark
- None really, but that flat 20% is steep on lower-priced items
Mercari
- Promotional offers (seller-funded discounts)
- Smart Pricing auto-drops can catch you off guard
A Real Example: Following One Flip
Let’s trace an actual item through the entire process to see real costs:
The Item: Vintage Carhartt jacket found at Goodwill
Acquisition:
- Goodwill price: $14.99
- Sales tax (8%): $1.20
- Gas (20 miles round trip): $3.00
- Total acquisition: $19.19
Prep:
- 10 minutes cleaning and checking
- 8 minutes photography
- 12 minutes listing
- Packaging materials: $2.50
- Total prep cost (materials only): $2.50
Sale:
- Sold on eBay for: $85
- Free shipping offered
- Shipping cost (Priority Mail): $12.50
- eBay fees (13.25% of $85): $11.26
- Total deductions: $23.76
Profit Calculation:
- Sale price: $85.00
- Minus shipping: -$12.50
- Minus eBay fees: -$11.26
- Minus acquisition cost: -$19.19
- Minus packaging: -$2.50
- Net Profit: $39.55
That’s a solid flip. But notice how an $85 sale turned into $39.55 actual profit. That’s only 46.5% of the sale price ending up in your pocket.
And that’s not even counting the ~30 minutes of work involved.
How to Actually Track This Stuff
You need a system. Doesn’t have to be fancy:
Simple Spreadsheet Method: Track for each item:
- Item description
- Purchase price (including tax)
- Sale price
- Platform fees
- Shipping cost
- Packaging cost
- Net profit
Monthly Summary:
- Total sales
- Total fees
- Total shipping
- Total cost of goods
- Total profit
- Profit margin percentage
If you’re not tracking this, you’re just guessing. And guessing is how people “sell $5,000 worth of stuff” while barely breaking even.
What Good Margins Actually Look Like
After all costs, here’s a general guide:
- Under 30% profit margin: Dangerous territory unless you’re doing high volume
- 30-50% margin: Decent, sustainable for most flippers
- 50-70% margin: Good, this is the sweet spot
- 70%+ margin: Excellent, but usually means lower-priced items or great sourcing
If your overall profit margin is under 30%, you need to either find better inventory, sell on platforms with lower fees, or be more selective about what you flip.
Quick Ways to Improve Your Margins
- Source cheaper: Look for sales, half-off days, estate sales instead of retail thrift stores
- Ship smarter: Use calculated shipping or build shipping into your price strategically
- Bundle items: Combine shipping, increase average order value
- Know your platforms: Some items do better on specific platforms with different fee structures
- Skip low-margin items: Sometimes the best flip is the one you don’t do
- Reduce returns: Better photos and descriptions = fewer problems
The Bottom Line
Flipping can absolutely be profitable. But only if you actually know your numbers.
Your real profit is: Sale Price - Platform Fees - Payment Processing - Shipping - Packaging - Acquisition Cost - Supplies - Gas - Time Value
That’s very different from “Sale Price - What I Paid.”
Track your real costs. Know your real margins. Make decisions based on actual profit, not gross sales.
Because at the end of the day, it doesn’t matter how much you sell. It matters how much you keep.