Markets / An interactive explainer
Follow the money
Follow a $100 purchase and see who pays when a fee changes. Move one number to see what the seller keeps, what the customer pays and who controls the relationship.
Fictional numbers. Transparent arithmetic. A way to understand the mechanism, not a real-company valuation or pricing recommendation.
One purchase. A different fee.
A fictional maker sells a product through a marketplace. Try a higher or lower marketplace fee. See what happens if the seller keeps the same price, or changes the price to keep about the same amount left over.
All dollar amounts are USD per purchase. Use up to two decimal places. Both percentage fees apply independently to the final customer price. Production and fulfilment stay fixed.
No account needed. Inputs stay in this page and reset on reload; nothing is saved or sent by this widget.
Who gets what?
The platform still has its own bills to pay from its fee revenue. The seller's share is the money left after these per-purchase costs, before other bills. We call that contribution. Neither figure is net profit or take-home income.
Starting purchase
20% platform fee under your starting assumptions.
Customer pays
$100.00
- Platform fee revenue
- $20.00
- Payment processing
- $3.00
- Production
- $30.00
- Fulfilment
- $10.00
- Seller: money left
- $37.00
Seller keeps the price
30% platform fee, with the same customer price.
Customer pays
$100.00
- Platform fee revenue
- $30.00
- Payment processing
- $3.00
- Production
- $30.00
- Fulfilment
- $10.00
- Seller: money left
- $27.00
Customer price changes
A price that keeps about the same amount left for the seller, allowing for rounding.
Customer pays
$114.93
- Platform fee revenue
- $34.48
- Payment processing
- $3.45
- Production
- $30.00
- Fulfilment
- $10.00
- Seller: money left
- $37.00
At the same price, the fee change moves the money left for the seller from $37.00 to $27.00 per purchase. The calculated customer price changes by $14.93. This does not predict whether customers would still buy.
Rounding: the calculated price is $114.92537 before rounding to cents. Each fee rounds to the nearest cent (half cents round up); the seller receives the remaining cents. Displayed contribution differs from the starting value by $0.00.
The money split is only half the story
These are authored assumptions for this fictional marketplace. A fee percentage alone cannot tell us who has more control.
- Who sets the price?
- The maker chooses the listed price. The marketplace sets its fee terms. A higher listed price may cost the maker sales; this example does not estimate that response.
- Who controls customer access?
- The marketplace runs discovery and checkout. The maker cannot assume that reaching those buyers again outside the marketplace will be easy.
- Who can leave?
- The maker can choose another channel, but must rebuild customer access and arrange payments and fulfilment. Switching is an option with work and costs, not a free escape.
Ask next: what does the fee pay for, what would it cost to replace those services, and who has a credible alternative? The percentage alone cannot answer those questions.
Formulas, limits and reading
Before rounding: seller contribution = customer price × (1 − platform fee rate − processing fee rate) − production − fulfilment.
To preserve that contribution: new price = starting price × (1 − starting platform fee rate − processing fee rate) ÷ (1 − changed platform fee rate − processing fee rate). Rates are fractions: 20% = 0.20. The unchanged production and fulfilment costs cancel out.
For the default example: $100 × (1 − 0.20 − 0.03) − $30 − $10 = $37. At a 30% platform fee, the same price leaves $27. Preserving the unrounded contribution requires $77 ÷ 0.67 = $114.92537…, shown as $114.93.
Fee amounts round independently to integer cents. Contribution is the remainder, so the displayed amounts always add to the customer price, including a negative contribution. Rounding can shift the contribution by a cent or two; this is not a minimum-price optimizer.
This is one purchase, with no quantity or demand forecast. Amounts must be $0–$1,000,000. Fee rates must each be 0–100%, with each platform-plus-processing combination below 100%. Repriced results above $10,000,000 are not displayed as usable prices.
Excluded: tax, refunds, tips, marketing, subscriptions, fixed overhead, and any wages or other costs not included in the entered production and fulfilment costs. Real contracts may use different fee bases, minimums, fixed charges, or bundled services. A $0 price is a free transaction, not zero sales.
Background reading: the SEC's guide to financial statements explains revenue, expenses and profit. Etsy's payment-processing explanation illustrates why fee types and bases matter. These explain mechanisms; none of this example's numbers describe either organization or a real seller.