gross product sales − discounts − refunds + shipping chargedTax and duties are assumed to be excluded. If your business treats shipping revenue differently, change the model and label it.
Calculator
Build the revenue and variable-cost waterfall
Use one reporting period and one currency. Enter positive amounts for discounts, refunds, and costs; the calculator subtracts them. The calculator code processes inputs in your browser and does not submit or store them.
Waterfall formulas
What the calculator is doing
net revenue − COGS − fulfillment − payment fees − platform fees − other variable costsThis isolates the amount available for paid media and contribution profit under the selected cost boundary.
pre-media contribution − paid-media spendThis is not accounting net income. Fixed payroll, rent, software, overhead, financing, and tax are excluded unless entered as variable costs.
contribution profit ÷ net revenueAggregate the compatible amounts first and then divide. Do not average daily, channel, SKU, or order-level margin rates.
net revenue ÷ pre-media contributionThis estimates the blended revenue-to-ad-spend ratio at which contribution after media reaches zero if the entered economics remain unchanged. It is not a platform attribution target.
Assumptions checklist
Define these before sharing the result
- Period and cohort.Choose order date, payment date, fulfillment date, or another basis. Decide whether late refunds are returned to the original order cohort or shown on the refund date.
- Revenue components.State whether gross product sales excludes tax, duties, tips, gift cards, and shipping, and whether refunds include non-item goodwill adjustments.
- Cost boundary.List COGS, landed cost, pick-and-pack, outbound shipping, return handling, payment fees, marketplace fees, and variable support costs separately.
- Paid-media scope.Use complete spend for the same brands, stores, countries, dates, and currency. Platform-attributed revenue is not the numerator in this calculator.
- Currency policy.Group by original currency or convert all revenue and cost bases under one documented exchange-rate source and rate date.
- Completeness.Label missing or estimated costs. A positive contribution margin calculated with missing COGS or fulfillment cost is not publishable evidence.
Interpret the result
What this calculator can and cannot tell you
Can: expose the waterfallShows exactly which entered revenue and variable-cost components move contribution profit.
Can: test scenariosLets you change refunds, costs, and paid media to inspect sensitivity under fixed assumptions.
Can: create a policy draftProvides formulas that can become a governed metric definition after source and grain validation.
Cannot: verify source completenessThe calculator does not know whether Shopify, payment, fulfillment, or ad-spend inputs are missing.
Cannot: allocate causal creditSubtracting paid media does not prove which channel or campaign caused an order.
Cannot: replace accountingThe result excludes fixed expenses and is not GAAP, tax, cash-flow, or financial-statement advice.
Primary sources: verify the commerce inputs
The formulas above are a modeling convention. Check current provider definitions before mapping Shopify sales, reversals, payments, refunds, or order exports into the inputs.
Build the governed version
From a scenario to an order-level model
Shopify contribution margin
Map Shopify order facts, cost rules, operational costs, and paid media into a readiness-gated model.
Contribution margin guide
Review cost boundaries, order and SKU grain, CAC, payback, and common caveats.
Ecommerce profit metrics glossary
Compare gross sales, net revenue, gross profit, contribution profit, and margin rates.
Confirm the inputs before treating contribution profit as ready
Metric Hive has backend contracts for cost rules and order-line and order-level profit, but Commerce Intelligence is not broadly customer-launch ready. Real account outputs require source coverage, cost completeness, materialized rows, validation, provenance, and safe currency handling. Some accounts may require a guided pilot or readiness review.