Cost of Goods Sold (COGS): Definition & How to Calculate It
- Product or manufacturing costs
- Packaging
- Shipping to warehouse
- Custom duties or import fees
- Any direct fulfillment costs
- See true profit in real time. Especially if you’re running paid ads or influencer campaigns.
- Spot unprofitable products. If a SKU has high returns or low margins, COGS will reveal it.
Make better pricing decisions. Know your break-even point before running discounts or promos. - Scale smartly. Once you know your high-margin winners, you can confidently reinvest in them.
Tracy Ng
Senior Content Executive at TrueProfit & SEO/Content Specialist
Tracy is a senior content executive at TrueProfit – specializing in helping eCommerce businesses scale profitably through content. She has over 4 years of experience in eCommerce and digital marketing editorial writing. She develops high-impact content that helps thousands of Shopify merchants make data-driven, profit-focused decisions.
