Unlock key performance calculations by adding your Cost of Goods Sold, or COGS. Performance metrics in the Product Catalog that are unlocked include the following: estimated gross profit, estimated gross margin, and estimated pre-ad gross margin.
These metrics allow you to analyze the profitability of your business at the SKU-level and determine if your ACOS targets are set too conservatively or aggressively
What are COGS?
Cost of Goods Sold (COGS) is a financial term that defines the specific costs directly connected to the production of goods by a company. This encompasses the expenses related to raw materials and labor directly involved in creating the product, while excluding indirect costs such as distribution expenses and sales team expenditures.
COGS: What to include and what to exclude?
COGS should represent the manufacturing cost per unit, as well as any costs associated with getting your product to a fulfillment center. Don't worry about including fee data, we've got you covered there.
What to include | What to exclude |
Variable costs involved in manufacturing products, such as raw materials, labor, and freight/shipping costs | Amazon selling fees |
Fixed costs such as storage fees and factory overhead | Amazon FBA fees |
Cost to ship goods to Amazon fulfillment center | Amazon's referral fees |
Please note if you've selected more than one Merchant Country you'll need to add COGS for all products.
How are my COGS used to calculate Profitability?
Profitability, when assessed using Cost of Goods Sold (COGS), refers to a measure of how effectively a company manages its production and manufacturing costs in relation to its revenue. It reflects the ability of a business to generate profits after deducting the direct expenses associated with producing the goods it sells. A higher profitability, in this context, suggests that a company is efficiently controlling its COGS and is more likely to generate a greater profit margin from its sales.
These values are reflected in the product catalog using these calculations when COGS are present; if COGS are missing, these fields will show as "N/A"
Estimated gross profit
Estimated profit after considering all costs associated with the product, including unit COGS, estimated fees, and ad spend.
Total sales - ( Total COGS + Est. Fees + Ad spend )
Estimated fees
Flywheel pulls in these details from the merchants automatically, representing all fees associated with selling a product on a sales channel.
Amazon: Referral Fees + FBA Fees + Variable Closing Fees
Walmart: Referral Fees
( Estimated referral fees * Units sold ) + ( Estimated variable closing fees * Units sold ) + ( Expected fulfillment fees * Units sold )
How do I use the Recommendation Hub to update my COGS?
All products missing COGS values will appear in the list within the recommendation card. For more details about COGS and options to update within the Product Catalog, check out this article.
Within the recommendation card, you can directly enter a value for each individual item; or can use the multi select tool to pick several items to bulk edit.
Individual entry:
Find an intended item
Enter a value
Repeat for other item(s)
Select 'submit'
Bulk entry:
Use checkboxes to select multiple intended items (1st image)
Select edit selected button (1st image)
In the slide over, indicate a value for all items (2nd image)
Select apply (2nd image)
Select submit (3rd image)
