Merchant Processing Fees
Definition
Fees charged by payment processors like Shopify Payments, Stripe or PayPal for each card or digital payment, usually a percentage plus a fixed amount per transaction.
Want a deeper explanation?
Formula
Fee per Transaction = (Order Total × Rate %) + Fixed FeeProcessing fees are a variable cost of every sale and belong in contribution margin. They are easy to miss because processors deduct them before paying you.
Recording gross sales and fees separately is what keeps both visible. Watch for: deposits booked net of fees, which understates revenue and hides one of your bigger variable costs.
Example
A $75 order at 2.9% + $0.30 costs $2.48 to process. At 5,000 orders a month, that is about $12,400.