Unit Economics Report
Contribution ladder, CM1 to CM3 · Generated 18 October 2026
| MRP (incl GST) | ₹1,499 |
|---|---|
| Discount | 10.0% |
| GST | 18.0% |
| Total product cost | ₹435 |
| Fulfilment | ₹129 |
| RTO rate | 18.0% |
| CAC per order | ₹380 |
| Units / month | 1,500 |
| Fixed overhead | ₹75,000 |
Unit economics calculator
What does one order actually leave you? Six sliders to start. Switch to Advanced when you want to itemise the cost sheet line by line. Nothing is hidden, just folded away until you need it.
Your numbers
Example numbers: replace with your ownThe six that move the answer most.
Price & product
Sells at ₹1,349 · net ₹1,143
Scales every product line together. Advanced splits them out.
Delivery & scale
Effective ₹463 once returns are counted.
That's 5.1% of net revenue after product, delivery, returns and buying the customer. You need 1,320 orders a month to cover overhead; you're modelling 1,500.
From price to what you keep
Blue is revenue and subtotals, orange is what comes out, green is what's left.
Where each ₹1,143 goes
Full monthly P&L
| Line | Per unit | Per month |
|---|---|---|
| Net revenue (ex GST) | ₹1,143 | ₹17,14,958 |
| Product cost | −₹435 | −₹6,52,500 |
| CM1 | ₹708 | ₹10,62,458 |
| Fulfilment | −₹129 | −₹1,93,473 |
| CM2 | ₹579 | ₹8,68,985 |
| Returns / RTO | −₹58 | −₹86,927 |
| Marketing (RTO-adjusted) | −₹463 | −₹6,95,122 |
| CM3 contribution | ₹58 | ₹86,936 |
| Fixed overhead | - | −₹75,000 |
| EBITDA | - | ₹11,936 |
| Depreciation & amortisation | - | −₹1,500 |
| EBIT | - | ₹10,436 |
| Net profit (PAT) | - | ₹7,827 |
Three moves, and what each is worth
Cut RTO from 18% to 14%: prepaid nudges at checkout do most of this.
Bring CAC down 15%, from ₹380 to ₹323.
An 8% price rise, to ₹1,619 MRP: usually the fastest of the three.
Estimates from your inputs, not a forecast.
CM1 is what's left after the product, CM2 after getting it to the door, and CM3 after returns and buying the customer. CM3 is the only one that pays your salaries. Returns are converted per delivered order, and marketing is charged on every order placed, including the ones that come back.
Profitable at this volume
Each order contributes ₹58, so 1,320 orders a month covers ₹76,500 of fixed cost. Every point off RTO is worth about ₹9 an order, cheaper than finding it in the ad account.
Questions this calculator answers
What is CM1, CM2 and CM3 in D2C?
They are the three rungs of the contribution ladder. CM1 is net revenue minus product cost. CM2 is CM1 minus fulfilment: shipping, gateway fees, packing. CM3 is CM2 minus returns and the cost of acquiring the customer. CM3 is the only one that pays for salaries, rent and profit.
How do you calculate break-even units for a D2C brand?
Divide total fixed monthly cost, including depreciation, by CM3 per order. If CM3 is negative there is no break-even volume: more orders simply enlarge the loss, and the fix has to come from price, product cost, RTO rate or CAC.
Should CAC be adjusted for RTO?
Yes. You pay to acquire every order placed, including the ones that come back undelivered. At a 25% RTO rate your effective cost per delivered order is your CAC divided by 0.75, a third higher than the figure in your ad account.
How the unit economics calculator works
Monday Marketing Company built this calculator around the contribution ladder: three profit measures that each remove one more layer of cost from an order. CM3 is the one that has to pay for salaries, rent and profit.
The formula
CM1 = net revenue − product cost CM2 = CM1 − fulfilment (shipping, gateway fees, packing) CM3 = CM2 − returns allowance − acquisition cost Break-even orders per month = fixed monthly cost ÷ CM3 per order
Worked example
Illustrative numbers for one order, not a benchmark.
| Net revenue per order | ₹1,000 |
|---|---|
| Product cost | −₹300 |
| CM1 | ₹700 |
| Fulfilment (shipping ₹90, packing ₹40, gateway ₹20) | −₹150 |
| CM2 | ₹550 |
| Returns allowance | −₹50 |
| Acquisition cost (CAC) | −₹250 |
| CM3 | ₹250 |
With ₹5,00,000 of fixed cost a month, break-even is 5,00,000 ÷ 250 = 2,000 orders a month. If CM3 is zero or negative there is no break-even volume: more orders only make the loss bigger, and the fix has to come from price, product cost, returns or CAC.
How to read the result
Start with CM3 per order. If it is positive, the question is volume: can the brand reach the break-even order count with the demand and the cash it has? If it is negative, look at which line is largest relative to the order value. Price, product cost, the returns rate and CAC are the four levers, and fixing the biggest one first moves CM3 the most. Re-run the numbers whenever a cost changes, such as a new courier rate or a price rise.
Adjust CAC for returns. You pay to acquire every order placed, including the ones that come back undelivered. At a 25% return rate, the effective cost per delivered order is CAC ÷ 0.75, a third higher than the figure in your ad account.
Read the guide: contribution margin and the ROAS you need to break even Break-even ROAS calculator D2C marketing glossary
Next step
Fix the order economics before you scale.
On a call, with a senior strategist. We rebuild your unit economics with you and show where margin is lost.
