% COGS of Product Revenue
What a product cost to make, as a share of what it really earned after markdowns.
What it means
% COGS of Product Revenue is a product's cost of goods divided by its Product Revenue, expressed as a percentage. Product Revenue is Gross Sales minus Product Discounts, and it includes tax. So the denominator is what the product earned after markdowns came off — not its list-price value.
That single choice is what separates it from the app's other Shopify cost-share column, % COGS, which divides by Gross Sales. This one has seen your discounts. That one hasn't.
Show the math
Formula and a worked example
COGS is what the units cost you, taken from the cost price held against each variant.
Product Revenue is Gross Sales minus Product Discounts, tax included. Gross Sales is item price × quantity, before any discount.
Worked example. A product sells 400 units at €50, so Gross Sales is €20,000. You gave €4,000 of product discounts, so Product Revenue is €16,000. The units cost €14 each, so COGS is €5,600. % COGS of Product Revenue = 5,600 ÷ 16,000 = 35%.
Run the same €5,600 against the pre-discount €20,000 and you get 28%. Same product, same supplier, same month — seven points apart, and the whole gap is the markdown. 28% is what % COGS% COGSLower % generally means better product margins. would report for the same product, because that column divides by Gross Sales.
It answers the question
Of the money this product actually brought in, how much of it was the product? It's the first cut taken out of what you banked, and it's the version of the cost ratio that a discount can move.
Why it matters
This is the cost share you can act on, because it responds to both things you control. Negotiate the unit cost down and it falls. Stop discounting the line and it falls too. A cost ratio measured against list price only ever answers the first half.
It's also the fair way to rank a mixed catalogue. A €9 accessory and a €300 coat can't be compared on profit in euros, but they can be compared on how much of their earned revenue went straight back out to the supplier, and that ranking is what tells you which lines are worth pushing.
One thing to hold in mind: tax sits inside Product Revenue. In a market where prices include VAT, the denominator carries money that was never yours, so the ratio reads a little kinder than the true cost share. The effect is consistent month to month, so trends stay reliable even where the level runs flattering.
What good looks like
These bands assume every variant has a real cost price against it. A product with no cost synced reads 0% and drags the whole table's average down with it, so check the blanks before you trust the colour. Beyond that the honest target is your own category: a private-label line and a resold one can both work at completely different cost shares. The Product COGS table also states that cost figures update only at the end of the day, so today's row is incomplete by design — compare closed periods, not this morning.
How to improve it
| Lever | What you do | Expect | How long | Watch out for |
|---|---|---|---|---|
| Fast Fill in the missing cost prices | Sync variant costs from Shopify so every line has a real number behind it | The column becomes true, and often uglier | Same week | A blank cost reads as free and quietly flatters every profit figure built on it, so the whole page gets worse before it gets right. |
| Fast Pull the discount off the worst lines | Stop automatic markdowns on the products sitting highest in this column | The denominator grows, so the cost share falls | 1–2 weeks | Units usually fall with the discount. Watch Quantity on those lines for a month before deciding the trade was worth it. |
| Slow Buy deeper on what actually turns | Move to larger order quantities on your fastest sellers to earn a lower unit cost | Cost share falls on those lines and stays down | 1–2 quarters | Cash locked in stock, plus markdown risk if demand turns before the depth sells through — which lands right back in this column. |
| Slow Shift the mix toward the cheaper-to-make lines | Point merchandising and ad budget at the products with the lowest cost share | The blended figure falls with no product changing | 1–2 quarters | You're steering demand rather than fixing cost, so total units can fall while the ratio improves. Check the volume on the lines you starve. |
Every lever costs something somewhere. The last column is the one to read twice.
Read it with
This column already knows about your discounting. Reading it against the discount column is what tells you whether cost or markdown moved it.
Margin from both ends
Cost took less of the revenue and you didn't hand it back at the till. Usually one supplier change or one pricing decision rather than a trend.
Discounting hid a cost rise
You markdowned less and the cost share still climbed, so the increase is real and on the supply side. Nothing about trading explains this one.
Bought volume with margin
Odd combination, and it usually means the mix shifted toward cheaper-to-make products during a promotion. Deliberate in a clearance, expensive as a habit.
Squeezed at both ends
Costs rose and you discounted harder to keep units moving. This is the corner where doing nothing has a price attached.
Product Discounts sit in this column's denominator, so the two move together by construction. When cost share climbs and the discount share climbed first, you've found the cause on the same row. When cost share climbs and discounts held flat, the supplier moved.
Cost share and volume, side by side. A punishing cost share on a product carrying twelve units a month is a rounding error. The same share on your best seller is where the money is going. Neither number ranks your problems without the other.
Common misreads
It means no cost price is synced against the variant. A blank cost reads as free here and inflates every profit number built on top of it.
They divide by different things. % COGS uses Gross Sales, before discounts; this uses Product Revenue, after them. On identical costs this column always reads higher, and the gap between them is exactly what you gave away.
Only product cost is in this ratio. Shipping, payment fees, advertising and everything you enter in Cost Settings all sit outside it, and any of them can turn a comfortable cost share into a loss.
Also called
Cost of goods as a share of net product revenue · COGS ratio · product cost share
See yoursCost share for every product, in the same row as Gross Sales, Product Revenue, Quantity and the discount columns.
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