How to calculate Amazon gross profit? How to get 30% Amazon gross profit margin?

I believe everyone should know about Amazon. Amazon is a cross-border e-commerce platform that many people like. Therefore, many people are willing to join Amazon to open their own cross-border e-commerce stores. How to calculate Amazon's gross profit?

1. How to calculate Amazon’s gross profit?

Simply put, gross margin is your sales revenue, minus your product costs and cost of goods sold. In the first line of profit, we call it actual revenue. Cost of goods sold includes the cost of the product, the cost of preparation and packaging, and any customs fees for shipping to you or Amazon. Cost of goods sold includes your Amazon fees and processing fees for website sales.

2. Two common mistakes made by e-commerce sellers:

1. Sellers make some common mistakes when it comes to gross margin. First, many sellers look at their inventory software or listing software to determine this number. Software usually does a good job, but it must be maintained.

2. It is not a system that you can just set and forget. If your purchase price changes, your selling price or your shipping method changes, it can have a huge impact on your profitability. You need to keep your inventory software updated with your latest information to ensure that the summary gross margin data is accurate.

3. Secondly, your inventory software doesn't actually have a "reconciliation" type program like your accounting system does. Do a quick check of your inventory system every month to make sure the numbers you are using are giving you similar results to the accounting system.

4. If you get different results and the reconciliation is complete and up to date in your accounting system, take the time to evaluate the accuracy of your inventory tracking system.

3. How to get a 30% Amazon gross profit margin?

1. The gross profit of the accounting system is the sum of all products. It is recommended that sellers strive to achieve a gross profit margin of 30% for each product. However, not every product has the same performance. In your product portfolio, some high-performing products will increase the average, while others will reduce the average.

2. After confirming that the inventory system data is consistent with the accounting system, take the time to understand the best performing products and the poor performing products. What measures can you take to make those best performing products get more sales? Take advantage of the success of that product as much as possible.

3. Next, look at your worst performing products. Is it time to get rid of them? Many times, a product has been underperforming for a long time, but you still remember its "glory days". Continuing to invest in underperforming products will drain your business. It will take up your attention, time, and money. Time and cash are resources that need to be invested in products that will generate adequate returns.

Amazon's profit is divided into gross profit and net profit. Both gross profit and net profit need to be understood by all friends. In particular, the calculation method of gross profit has been explained in detail in the above content. Merchants who open stores on Amazon must remember the relevant formulas firmly!

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