Faire margin is the wholesale price minus four things: Faire's commission, payment processing, fulfillment (packing, shipping, damage or returns), and whatever it cost to win the order — samples, a discount, or a promotion. Most sellers track the first one and quietly eat the other three.
The fastest way to find the real number: take one typical order and subtract each of those four costs from the wholesale price, line by line. What's left is the actual margin, and it is usually smaller than the number in a seller's head.
The wholesale price on the invoice is not what lands in the bank account. Four categories of cost sit between the two, and only one of them is easy to see.
Commission and payment processing are the visible ones — a cut of the order total, taken before payout, that shows up on every settlement. Depending on how a platform structures its fees, payment processing is sometimes its own line item and sometimes folded into the commission rate, but either way it's the cost sellers can usually quote from memory, because it's the one they're shown.
Fulfillment is packing materials, the box, the label, the time spent picking and packing, and whatever share of damaged or returned goods never gets reimbursed. None of that appears on a settlement statement — it shows up on a shipping bill, a supply order, or nowhere at all.
Cost to win is everything spent to get the order to exist: samples sent before a buyer committed, a discount or promo code that closed it, or a paid placement that got the product in front of the buyer to begin with. It's real money, spent on a real order, and it almost never gets connected back to that order.
| Cost | What it covers |
|---|---|
| Commission | The platform's cut of the order total, taken before payout — the number most sellers can quote from memory because it appears on every settlement. |
| Payment processing | The cost of accepting and clearing the buyer's payment, whether it's billed as its own line item or folded into the commission rate. |
| Fulfillment | Packing materials, the box, the shipping label, the time to pick and pack, and whatever share of damaged or returned goods doesn't get reimbursed. |
| Cost to win | Samples sent before the order existed, a discount or promo code that got the order across the line, and any paid placement that helped the buyer find the product. |
Three separate charges, not one. Faire's own North America fee documentation sets them out: a commission on the order subtotal, a one-time fee the first time a marketplace retailer buys, and a payment processing fee set by how fast the brand wants to be paid.
The number everyone quotes is the 15% commission, and it describes only part of what a brand pays — on some orders, a small part. Commission is 15% on marketplace orders and 0% on Faire Direct orders, meaning retailers the brand brought to the platform through its own link. The $10 new customer fee lands once, on a new marketplace retailer's first order, and never again. Payment processing runs from 1.9% to 3.5% plus 30 cents, and the brand picks which by picking a payout speed.
| Charge | Rate | When it applies |
|---|---|---|
| Commission, marketplace | 15% of subtotal | Every order from a retailer Faire introduced. |
| Commission, Faire Direct | 0% | Every order from a retailer the brand brought itself, through its own Faire Direct link. |
| New customer fee | $10, once | A new marketplace retailer's first order only. Never charged on a reorder. |
| Payment processing | 3.5% / 2.4% / 1.9%, plus $0.30 | Every order. The rate follows the payout speed — next day, 30 days, or 60 days. |
Those are the North American rates. Brands based elsewhere pay a different structure: a 10% referral fee on top of the 15% for a new customer's first order, which makes that first order 25%, with no separate new customer fee.
Pull up one order that you'd genuinely call typical for the business — not the best month, not the worst. Write the wholesale price at the top of a page, and subtract the four costs from it, one at a time, using real figures wherever they exist rather than round-number guesses.
Subtract commission first — it's on the settlement, so this part is easy. Subtract payment processing next, wherever it's broken out separately. Then subtract fulfillment: the actual cost of the box and label for that order, plus a fair share of whatever damage or returns cost the business that month. Finally subtract cost to win — if a sample or a discount helped land the order, its cost belongs here, even if it was paid weeks earlier.
What's left, divided by the wholesale price, is the real margin. Compare it to the "headline" margin most sellers carry in their head — usually just wholesale price minus commission — and the gap between the two numbers is exactly what the other three costs were quietly taking.
Doing this once, for one order, takes about ten minutes. Doing it across a full catalog every month is a different job, and it's where a lot of sellers start asking whether a Faire analytics tool actually pays for itself instead of doing the arithmetic by hand.
Cost to win. It never appears as a deduction on the order it produced — the sample went out in a shipment weeks before the order existed, the discount lived inside a promo code, and a trade show bill arrived in a completely different accounting month. Nothing on the settlement statement ties any of it back to the order it eventually generated, so most sellers never do the arithmetic that would connect them.
Fulfillment runs a close second, for a similar reason: the packing time and the damage write-off don't sit next to the order either. But at least fulfillment usually shows up somewhere in the books, as a shipping bill or a supply order. Cost to win often doesn't show up anywhere that reads as a cost at all — a sample looks like marketing, a discount looks like a favor to a good buyer, and neither one gets subtracted from anything.
The fix is mechanical, not clever: keep a running tally of what gets spent on samples and discounts over a stretch of time, divide it by however many orders that spend actually produced, and treat the result as a real per-order cost — because it is one.
Yes, but only for the costs that are partly fixed rather than purely a percentage. Packing labor doesn't double just because an order is twice the size, and a sample that helped win a small first order costs the same whether the buyer reorders small or reorders big. Both of those shrink as a share of a larger order, which means fulfillment and cost-to-win margin drag tend to look better on bigger orders — not because anything got more efficient, just because the fixed piece is spread over more revenue.
Faire's own fees work the same way, which is easy to miss because the headline rate is a percentage. The 15% commission genuinely is proportional. But the $10 new customer fee and the 30 cents on payment processing are flat, so they land far harder on a small order than a large one: on a $150 first order those two together are 6.9% of the order value, and on a $2,000 first order, about half a percent.
Put all three charges together and the same brand can pay wildly different effective rates in the same month:
| Order | Commission | New customer fee | Processing | Effective rate |
|---|---|---|---|---|
| $150 first order, marketplace, next-day payout | $22.50 | $10.00 | $5.55 | 25.4% |
| $400 reorder, marketplace, 30-day payout | $60.00 | — | $9.90 | 17.5% |
| $2,000 reorder, Faire Direct, 60-day payout | — | — | $38.30 | 1.9% |
Those are illustrative order sizes, but nothing else in the table is invented — every rate is Faire's published rate applied straight. The spread comes from three things moving at once: whether the retailer was introduced by the marketplace or by the brand, whether it is a first order or a reorder, and how fast the brand chose to be paid. All three are things a brand influences — who it recruits itself, how many of its retailers come back, and how quickly it needs the cash.
Which means the real margin on a small first order and a larger reorder from the same buyer can genuinely differ, and it's worth recalculating rather than assuming one number covers both. That's also worth weighing against how often a reorder of any size actually happens in the first place — see how reorder rates typically play out for the other half of that decision.
This exercise is worth doing when a seller genuinely doesn't know their real number, or suspects the headline figure is hiding something. It's not worth doing on a single small order just to satisfy curiosity — the ten minutes it takes to calculate can cost more than what's at stake in the answer.
It also isn't the right frame if the actual constraint is cash flow rather than margin. A healthy margin on paper doesn't help if payouts land too slowly to cover the next production run — that's a timing problem, and no amount of line-by-line cost subtraction fixes it.
And a low margin on one product isn't automatically a reason to drop it. A SKU that loses money on paper but reliably gets a store to place its first order, or brings a buyer back for a second one, may be doing a job the margin number doesn't capture. Look at what a product does for the relationship before cutting it on margin alone.
Last updated August 2026. Written by the maker of FaireSight, a retention tool for brands selling wholesale on Faire. Not affiliated with Faire.