Help Profit and costs
Profit metrics
Once your costs are in, Stetto works out what you keep at each step: after the product, after shipping and fees, and after ads.
The metrics
| Metric | What it is |
|---|---|
| “Cost of goods (COGS)” | Units sold times each product’s cost per unit. |
| “Gross profit” | Net sales minus cost of goods. |
| “Gross margin” | Gross profit as a share of net sales. |
| “Shipping & payment fees” | Shipping per order, plus payment processing. See Per-order costs. |
| “Contribution before ads” | Gross profit minus shipping and payment fees. It’s what each sale leaves to pay for marketing. |
| “Contribution profit” | Contribution before ads minus total ad spend. |
| “Contribution margin” | Contribution profit as a share of net sales. |
| “Profit on ad spend (POAS)” | Gross profit over total ad spend. Above 1x, your ads pay for the product they sell. |
| “Break-even ROAS” | Net sales over contribution before ads. It’s the MER at which ads exactly pay for themselves, so lower is better. |
| “Profit per order” | Contribution profit divided by orders. |
Read them together
- Watch MER against break-even ROAS. When MER sits above the break-even line, your ads are paying for themselves. The “Profit” template puts the two on one chart. See The templates.
- POAS and contribution profit answer different questions. POAS counts only the product’s cost. Contribution profit also takes off shipping, fees and every ad.
Good to know
- Net sales are Shopify’s, after discounts and refunds. They’re the same sales every other card uses. See How Stetto counts.
- These are before overheads. Rent, salaries and software aren’t in any of them.
- Ad spend is the workspace’s total ad spend. Split by store or region, each one counts the ad accounts paired with it. See Pair ad accounts to stores.
- Missing costs never count as zero. A profit card waits until its products have costs. See Why profit cards wait.
Related
Still stuck? Email support@getstetto.com and a person will answer.