How to calculate COGS on Shopify (correctly)
Cost of goods sold (COGS) is the single most important input to real profit. Get it wrong and every profit number after it is a guess. Here is how to get it right.
What COGS includes
For each unit you sell, COGS is what it costs you to have it ready to ship:
- The product cost you pay your supplier.
- Inbound shipping to get stock to you.
- Packaging and any per-unit handling.
- Duties or import fees, spread per unit.
It does not include overheads like rent, salaries or advertising — those are separate operating costs, not per-unit COGS.
How to set it in Shopify
Shopify has a Cost per item field on each product variant. Fill it in for every variant and keep it up to date as supplier prices change. Tools that read your store — including Profixo — use this field automatically.
Why getting it right matters
Without an accurate cost, no tool can tell you whether a product is profitable —
it can only estimate. That is why Profixo will not fabricate a cost: if the
Cost per item is missing, it asks you for it rather than guessing. See
product costs & confidence.
Once your costs are in, pressure-test a product with the profit margin calculator.
Costs in, leaks out
With accurate costs, Profixo shows the true profit of every product and alerts you when one loses money. Start a free 14-day trial.