E-commerce entrepreneurs, you won't believe how many merchants with impressive sales results end up losing money! Why is this so? The answer is hidden in the calculation of gross profit.
Sustained profitability is the first and foremost requirement for a long-term business in the cross-border e-commerce sector. However, how to accurately assess profitability? In this article, we will analyze the key indicators on the income statement to help you fully grasp the operating status and growth trend.
If you don't know how to operate a profit and loss statement analysis, you will never be able to accurately determine whether your cross-border e-commerce business is truly profitable. As one of the four major financial statements, the income statement is an important tool for evaluating the effectiveness of your business strategy by detailing your income, expenses, gross profit, taxes, and other items over a specific period of time.
The biggest problem is that many sellers confuse the difference between gross profit and operating profit. Gross profit is operating income minus direct costs, while operating profit is the value after further deduction of operating expenses. These two figures reflect completely different business orientations!
You know that inAmazons open a storeWhat specific items are included in the cost of goods sold? For example, the monthly fixed fee of $39.99 for the Professional Sales Program, the sales commission of about 8-15% for different categories of goods, and the logistics cost calculated according to the size and weight of the goods, etc. These are all factors that should not be ignored when calculating gross profit. These are all factors that should not be overlooked when calculating gross profit.
What's more, Amazon also provides a variety of advertising programs to help sellers accurately reach their target customers. You can set an "average daily budget" to effectively control costs, for example, setting a daily budget of $200 to ensure that your ad spending will not exceed your expectations.
If you want your gross profit to grow steadily, in addition to mastering the gross profit formula: (Operating Revenue - Operating Costs)/Operating Revenue x 100%, choosing a trustworthy e-commerce platform is also crucial. Amazon Amazon Global Store, with more than hundreds of millions of users, has recently opened 14 overseas sites in Taiwan, and provides free operating tools, tax calculations, and official logistics services that help you to run your business properly.
Do you have any questions that you would like to be answered immediately? Don't hesitate to add our LINE, the green circle is waiting for you:https://line.me/ti/p/g2Vc38nLnR
# Cross-border E-commerce # Amazon Global Store # Operating Gross Profit # Profit and Loss Analysis # Taiwan Sellers # E-commerce Profit # Financial Management # 2025 E-commerce Trends # Branding # Cross-border Entrepreneurship
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