How a cross-border store earns money
Work out how much is left per sale
1. Lesson introduction
How much can you keep from a $30 order?
Subtract product $8, shipping $6, fees $1.20 and advertising $10 from $30. You keep $4.80.
How this is calculated
- $30 − Product $8 − Shipping $6 − Payment fee $1.20 − Advertising $10 = $4.80
- These are example figures. In this lesson, you will calculate costs for a real product.
- 7 steps. Finish with a cost record.
2. Where the money goes
Where the money goes
The buyer's $30 first goes to three businesses.
The buyer pays your store $30. The payment platform gets $1.20, advertising gets $10, and CJ gets $14 for the product and shipping. You keep $4.80. Example figures.
The selling price is not what you keep. After all costs, the remainder is yours.
This picture leaves out one cost:returns. Returned items often cannot be sold again. One return can use up the profit from several orders.
Learn more
- Example figures: CJ gets $8 for the product and $6 for shipping. Fees are $1.20 and advertising is $10.
- Fees are charged as a percentage of the selling price. A higher price means a larger fee.
- Calculate advertising as the average cost of making one sale. Beginners often underestimate it.
3. Where money comes from and goes
Look at the $30, purchase price and shipping in the quiz.
Subtract costs from the buyer's payment. What remains is your earnings.
A buyer pays $30. Which item is not your cost?
- Product purchase price
- Shipping to the buyer
- The buyer's $30 payment
Explanation
$30 is your revenue, not a cost.
4. Open the Cost calculator
Open the Cost calculator in Toolbox.
Work out what remains per order to decide whether the product is worth selling.
5. Import a real product
Click “Import from product” and choose a product.
Use real purchase and shipping prices to reduce the risk of underestimating costs.
6. Enter a selling price and calculate
Enter the selling price and each cost, then click Calculate.
Subtract each cost to estimate earnings per order.
For practice with no cost, enter 0 yourself. Fees and advertising set to zero are not included.
7. See what remains per unit
Look at “Approximate remainder per order” in the result.
This is the selling price less the costs you entered.
This is not final profit. Fees and advertising set to zero are not included.
Based on your calculation, how much remains per sale?
- ${{calculation.profit}}
- ${{calculation.net}}
- ${{calculation.landed}}
Explanation
This is the selling price less the costs you entered.
8. Save the cost record
Click “Save this lesson's cost record”.
Keep the selling price and costs so you can compare again after prices change.