> ## Documentation Index
> Fetch the complete documentation index at: https://docs.sourcemedium.com/docs/llms.txt
> Use this file to discover all available pages before exploring further.

# Merchant Processing Fees

> How merchant processing fees entered in the Configuration Sheet flow into profitability and gross profit reporting

Merchant processing fees are the costs charged by payment providers (Stripe, PayPal, Shopify Payments) to process customer payments.

## What Are Merchant Processing Fees?

These fees typically include:

* **Transaction fees**: Percentage of transaction (e.g., 2.9%)
* **Fixed fees**: Per-transaction fee (e.g., \$0.30)
* **Gateway fees**: Monthly/per-transaction gateway costs
* **Chargeback fees**: Fees for disputed transactions

<Info>
  Processing fees vary by payment method. Credit cards typically cost more than ACH/bank transfers.
</Info>

## Where Processing Fees Appear

| Module            | Usage                           |
| ----------------- | ------------------------------- |
| Executive Summary | Contribution margin calculation |
| Orders Deep Dive  | Order-level profitability       |
| P\&L Reports      | Operating cost line item        |

## Common Fee Structures

| Provider         | Typical Rate      |
| ---------------- | ----------------- |
| Shopify Payments | 2.4-2.9% + \$0.30 |
| Stripe           | 2.9% + \$0.30     |
| PayPal           | 2.9% + \$0.49     |
| Shop Pay         | 2.4-2.6% + \$0.30 |

## Setting Up Processing Fees

<Steps>
  <Step title="Calculate blended rate">
    Review payment provider statements to find your average rate across all payment methods
  </Step>

  <Step title="Open Configuration Sheet">
    Navigate to the merchant processing section
  </Step>

  <Step title="Enter percentage">
    Enter your blended rate (e.g., 2.7% for most DTC brands)
  </Step>
</Steps>

<Tip>
  Use your **blended rate** across all payment types. Most brands see 2.5-3.0% when combining credit cards, PayPal, and alternative payments.
</Tip>

## Related Resources

<CardGroup cols={2}>
  <Card title="Set up processing fees" icon="credit-card" href="/data-inputs/configuration-sheet/costs/how-do-i-surface-merchant-processing-fees-within-my-dashboard">
    Step-by-step setup guide
  </Card>

  <Card title="Contribution margin" icon="chart-pie" href="/help-center/common-analyses/understanding-your-contribution-margin">
    How processing fees affect contribution margin
  </Card>
</CardGroup>