Cost of Goods Sold (COGS): Definition & How to Calculate It

By Tracy NgMay 26, 202511 min read
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.

TrueProfit Shopify Profit Tracker

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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.

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