Revenue is the number everyone watches. Profit is the number that pays you.
The gap between them is made of many small costs, and they sit in different places: your Amazon account, your Shopify admin, your ad accounts, your returns, your supplier invoices. Each one looks small on its own. Together they decide whether a busy month was a good month.
Here are the five places where profit usually goes, with real numbers, and three things you can do this week.
First, see it in one line
Every store’s month comes down to this:
Revenue − fees − ad spend − returns − product and shipping = profit
If you can’t fill in each part of that line for last month, you’re not alone. That’s the first leak. Our store profit calculator lays it out for you in 30 seconds, using your own numbers.
1. Fees that live in five different places
Selling online means paying several small fees on every order. Here’s what Amazon and Shopify list for Germany, checked on the date at the top of this page:
Amazon.de
- The Professional selling plan costs €39 a month, excluding VAT.
- On top of that, Amazon takes a referral fee on every sale. Amazon says most are between 8% and 15%, depending on the category: for example 15% for books, toys and shoes, and 7% for consumer electronics.
- In most categories there’s a minimum of €0.30 per item, whichever is higher.
- If you use Fulfilment by Amazon, its fulfilment and storage fees come on top, based on size and weight.
Shopify (Germany)
- The Basic plan costs €27 a month billed yearly, or €36 billed monthly.
- With Shopify Payments, the online rate for standard cards on Basic is 2.1% + €0.30 per order.
- If you use a different payment provider instead, Shopify adds a 2% transaction fee on Basic.
- Apps are charged on top, and they add up quietly.
What that means for one €40 order:
- On Amazon at a 15% referral fee: €6.00, before fulfilment fees.
- On Shopify Basic with Shopify Payments: 2.1% of €40 plus €0.30 = €1.14.
Small per order. But 1,000 of those orders a month on Amazon is €6,000 in referral fees alone. The fix isn’t always cutting fees. It’s seeing them per product, so you know which products still make money after them.
2. Ads that buy the same customer twice
Ads are often the biggest cost after the products themselves, and the hardest to see clearly.
Two common leaks:
- Paying for customers you’d get anyway. Someone searches for your brand name and clicks your ad instead of the free result right under it.
- Paying again for customers you already won. A happy customer comes back through an ad because nothing else reminded them you exist.
A simple check: divide last month’s total ad spend by total revenue. Then do it per product. If a product’s ad spend eats most of its margin, it’s not a best seller. It’s a busy loss.
The long-term fix is stage 4 of our system, Bring Them Back: emails, messages and reviews that bring customers back without paying for them again.
3. Returns
Returns cost far more than the refund. There’s postage, someone has to check and repack the item, and sometimes it can’t be sold again.
A study by the University of Bamberg estimated that a returned item cost German online retailers about €11 on average in 2018, including postage and processing. Around 280 million parcels were sent back that year.
Many returns start with a product page that didn’t answer a question: the size, the colour in real light, what’s in the box. Better product pages and fast answers to questions are some of the cheapest ways to protect your margin.
4. Running out of your best sellers
When a best seller runs out, sales stop. And unless someone pauses them, ads can keep pointing people at a product they can’t buy.
You can see it coming with one line:
Days of stock left = units in stock ÷ units sold per day
If that number is shorter than your supplier’s delivery time, you’re already late. A simple alert on your top products fixes this for good.
5. Products that quietly lose money
Averages hide losers. A store can have a healthy overall margin while some products lose money on every sale, carried along by the good ones.
For your top products, work out what one sale really leaves you:
Price − fees − product cost − shipping − returns − ad spend per sale = what you keep
Some products will surprise you. Those are the ones to fix, re-price or stop advertising first.
Three things you can do this week
- Put last month in one line. Revenue, fees, ad spend, returns, product and shipping. One sheet, one month.
- Work out what you keep per product for your top 10 products.
- Set a reorder alert for your top 3 sellers using the days-of-stock-left line above.
That’s an afternoon of work, and it changes what you look at every Monday.
Want this done for you?
This is exactly what our free store profit audit looks at, alongside your search rankings, product pages, checkout and follow-up, compared with your top 3 competitors. You get your biggest leak and the fixes in order, and the report is yours to keep.
If you then want our help, we can build the weekly profit report and stock alerts so these numbers come to you every Monday, without the spreadsheet.