Formula
Net revenue = product sales + shipping charged - discounts - refunds.
Profit before ads = net revenue - product costs - shipping costs - payment fees.
Profit after ads = profit before ads - ad spend.
Operating profit explanation
Shopify revenue is only the start of profit.
MarginPatrol explains operating profit by subtracting the main variable costs from Shopify sales and showing accuracy status for the result.
Accuracy status
- Confirmed - enough data is available.
- Estimated - some costs use rules.
- Preliminary - data may still update.
- Incomplete - important data is missing.
- Excluded - intentionally not included, such as taxes in v1.
Boundary: MarginPatrol calculates operating profit for daily monitoring. It is not accounting, tax, audit or financial advice software. Source: Docs/05_business_logic/67_customer_facing_calculation_explanation.md.