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The Profit Glossary

Full glossary of leading metrics, formulas and desired outcomes

BeProfit Team avatar
Written by BeProfit Team
Updated over a week ago

Metric

BeProfit Formula

What is it good for

How to Use It

Costs

Refunds + Fulfillment Costs + Taxes + Transaction Fees + COGS + Marketing Costs

Analyzing comprehensive expenditure, ensuring all costs are considered

Monitor and control budget allocation, identify areas for cost optimization.

AOV

Orders Revenue / Order Count

Assessing the average value of each order

Identify trends in customer spending behavior, strategize for upselling or bundling opportunities.

Orders Revenue

Gross Sales - Discounts

Measuring revenue from sales after accounting for discounts

Understand the actual revenue generated, track the impact of promotional activities.

Gross Sales

Revenue from Sales + Sales Taxes + Shipping Revenue/Charged

Calculating total sales revenue before deductions

Evaluate overall sales performance, consider the holistic revenue picture.

Total Gross Revenue

Revenue from Sales + Sales Taxes + Shipping Revenue/Charged

Summing up all aspects of gross revenue

Gain a comprehensive view of total revenue before any deductions or returns.

Total Sales

Total Gross Revenue - Discounts - Returns/Refunds

Assessing net sales after accounting for discounts and returns

Understand the actual sales income received by the business.

Net Sales

Total Sales - Sales Taxes

Calculating net sales revenue

Evaluate sales income after deducting applicable taxes.

Fulfillment Costs

Shipping Cost + Handling + Duties

Determining the cost of order fulfillment

Optimize shipping strategies, control fulfillment expenses.

Product Costs

COGS

Calculating the cost of goods sold

Assess the direct costs associated with producing goods, inform pricing strategies.

Gross Profit

Net Sales - Transaction Fees - Fulfillment Costs - Product Costs

Evaluating overall profit after accounting for direct costs

Measure profitability after considering all direct expenses.

Gross Margin

Gross Profit / (Total Sales - Sales Taxes) * 100

Assessing the profitability percentage

Understand the profit margin as a percentage of total sales.

Contribution Profit

Gross Profit - Marketing Costs

Evaluating profit after deducting marketing expenses

Analyze the impact of marketing efforts on overall profitability.

Contribution Margin

Contribution Profit / (Total Sales - Sales Taxes) * 100

Net Profit

Contribution Profit - Operating Expenses

Evaluating overall profit after deducting operating expenses

Assess the business's net profitability after considering all expenses.

Net Margin

Net Profit / (Total Sales - Sales Taxes) * 100


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