Margin and profitability
The Margin sub-score is the second most-weighted in the composite. It rolls together your net margin % and net profit per unit into a 0–100 score.
In this guide:
- The formula
- COGS estimation
- Fees Hilal subtracts
- Reading the score
- Why dollar profit matters too
The formula
Net profit / unit = sell price − COGS estimate − FBA fee − referral fee
Net margin % = Net profit / sell price × 100
Margin sub-score = mapping of margin % to 0–100 (sigmoid-ish curve)A margin sub-score of 50 corresponds roughly to 20% net margin. 80 corresponds to ~35%. 100 corresponds to 50%+.
COGS estimation
Hilal doesn’t know what you’d pay for the product, so it uses an estimate:
- Crawlee data (Coming soon) — when Crawlee is live, AliExpress / Alibaba supplier prices feed in directly.
- Benchmark table — a Hilal-maintained per-category COGS-as-percent-of-sell-price benchmark. Conservative.
Today (Run 2), the benchmark table is the primary input. It’s accurate for category-typical products and conservative for unusual ones.
When supplier discovery ships, you’ll be able to override the COGS estimate with a specific quote — at which point the margin sub-score becomes a much sharper number.
Fees Hilal subtracts
Hilal pulls fees per product directly from Amazon’s Pricing API (via hilal-sp-api):
- FBA fulfillment fee — pick, pack, ship per unit.
- FBA storage — not subtracted from per-unit margin (storage is monthly, amortized separately in your finances). Hilal flags storage-heavy products in the AI brief.
- Referral fee — Amazon’s percentage of sale price, varies by category.
- Other fees — long-term storage, removal, returns processing — also flagged in the brief but not in the per-unit calculation (they’re rare per-unit charges).
Total subtracted fees are typically 25–40% of the sell price for FBA products.
Reading the score
| Margin score | Net margin % (approx) | What it means |
|---|---|---|
| 80–100 | 35%+ | Excellent. Comfortable margin. |
| 60–79 | 20–35% | Solid. Works for most operations. |
| 40–59 | 10–20% | Marginal. Need volume or efficiency to make this worthwhile. |
| 20–39 | <10% | Weak. Not enough room for ad spend, returns, or supplier-cost surprises. |
| 0–19 | Loss territory | Avoid. Likely a fee/cost problem. |
Why dollar profit matters too
A 30% margin on a $50 product = $15 net profit per unit. A 30% margin on a $5 product = $1.50.
The margin % drives the sub-score. The dollar profit per unit is a separate number on the result row. Glance at both:
- A 30%-margin product at $50 sell price is worth pursuing at low velocity.
- A 30%-margin product at $5 sell price needs huge velocity to be worth your operational overhead.
The AI brief on the product detail page usually flags this when the per-unit profit is too thin to justify the operational cost regardless of margin %.
Why this sub-score sometimes feels conservative
Hilal’s COGS estimate is intentionally conservative — it’s better to have you discover upside on a product than to bait you into one that turns out to lose money. When you have a real supplier quote, the margin sub-score may go up significantly.
Coming-soon features address this directly:
- Supplier discovery — match the product to actual suppliers, with their prices.
- Cross-platform pricing — Crawlee data improves the COGS input materially.