Your Orders Went Up. Did Your Profit?
You ran a promotion. Orders picked up. Your bank balance barely moved. Before repeating the offer, check what each order actually left behind.
Imagine a $40 order usually leaves $20 after its variable costs. Add a $4 discount, $6 shipping subsidy and $2 gift. Now it leaves $8, assuming the other costs stay unchanged. You would need 2.5 times as many orders to contribute the same amount toward overhead and profit.
Write down the price collected, product cost, packaging, selling fees, shipping you pay and any gift. Include paid time that changes with the order. Count each cost once.
Compare the usual order with the promoted order. Then ask: can I realistically sell and fulfil enough extra orders to make this worthwhile?
A promotion may help clear stock or introduce a product. Give it a purpose, a limit and a review date.
Our Markdown & Margin Calculator helps compare price reductions against the cost you enter. Include the relevant costs; it does not automatically add shipping or fees.
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