Calculator

Offer Margin Waterfall Calculator

Offers usually break in layers, not all at once. Use this calculator to follow the order from list revenue down through discounting, fee drag, return reserve, fulfilment, and ad cost so you can see what actually survives at the end.

Start from list revenue instead of net sales alone
Model the margin stack after discount and return reserve
See what the offer really keeps after ads

Map the offer through the margin waterfall

Enter list revenue, discount depth, fee rate, product cost, fulfilment, return reserve, and ad cost. The result shows how much the offer keeps after each layer takes its bite.

Gross list revenue Revenue at full price before the offer changes the order. Discount rate % Promotional discount applied to list revenue. Fee rate % Marketplace or payment drag on discounted revenue. Product cost Direct cost of goods in the offer. Fulfilment cost Pick-pack, shipping, or delivery burden. Return reserve rate % Reserve for refund or reverse-logistics pressure. Ad cost Traffic cost attributed to the offer.

Three offer waterfall scenarios.

Formula

What the waterfall is exposing

Net after full waterfall = Revenue after discount - Fees - Return reserve - Product cost - Fulfilment - Ad cost

The point of a waterfall is sequencing. It helps you see whether the offer is breaking because of discount depth, fee drag, return pressure, fulfilment, or acquisition, instead of letting all the pain blur together at the bottom line.

Where offer teams get fooled

They celebrate conversion while forgetting the discount rewrote the order.
Return reserve gets ignored because refunds happen after the campaign ends.
Ad cost is judged against topline lift, not retained margin.

Useful next step

Once the waterfall is visible, compare it against promotion payback and AOV tradeoff math so the offer can be judged as a system, not as a one-metric win.