nwslttr
⏩ Forwarded this email? Subscribe to get your own copy here
What A $28M in Shopify GMV taught us about the profit numbers brands trust too much
By Georgia Carapetis
Most Shopify brands can tell you their revenue, return on ad spend (ROAS), and gross margin.
Fewer can say, with real confidence, what they actually made once shipping, payment fees, returns, discounts, cost of goods sold (COGS), and ad spend are pulled into the same view.
That's not because the team is careless. It is usually because the tech stack was never built to answer that question clearly.
At MerchantFlow, we have tracked more than 128,000 Shopify orders, representing over A$28 million in gross merchandise value. Across that data, one pattern has recurred: brands that struggle to understand profit are often not short on dashboards. They are short on alignment between the numbers those dashboards produce.
Revenue lives in Shopify. Ad spend is in Google, Meta, TikTok, or other ad platforms. Cost of goods sold could be in Shopify, a spreadsheet, an inventory tool, or nowhere reliable at all. Fulfilment and shipping costs may sit with a third-party logistics provider. Regional delivery costs may be handled separately. Payment fees are somewhere else again.
Each tool may be doing its own job properly. The problem starts when those separate views are treated like a complete profit picture.
Why the Numbers Feel More Reliable Than They Are
The danger with eCommerce reporting is that most of the numbers look precise.
A dashboard can show revenue down to the cent. An ad platform can calculate return on ad spend. Shopify can report sales, refunds, and shipping. A spreadsheet can outline product margin. On their own, these numbers feel official.
But precision is not the same as completeness.
Shopify reporting is designed around eCommerce activity. It can show what was sold, refunded, discounted, and charged for shipping. Its profit reporting can also be useful, but it depends on the cost per item being added and maintained correctly.
Meanwhile, Google Ads optimises around the conversion values reported back to the platform. Meta reporting may also include estimated or modelled metrics.
None of this is wrong. It just means each system is looking at the business from its own angle.
That becomes a problem when merchants use those separate angles to make blended profit decisions.
The Blended Profit Gap
The blended profit gap is the space between what a brand thinks it made and what it actually kept after costs are factored in.
It usually shows up in boring places: missed transaction fees, outdated product costs, shipping costs assigned too broadly, returns visible in one report but not reflected in another, and ad spend reviewed at the channel level while product profitability is reviewed somewhere else.
Would you like to be a guest blogger on eCommerce Tech? Apply here
Popular on the Blog:
Explore the whole blog here
Tech to Explore
Looking for new solutions to your growth problems?
Our Featured Partners
Decile - Analyst-level customer intelligence in the hands of your marketing team. Surface insights within tools you're already using, and activate to your marketing and ad platforms with one click. Schedule a Demo
Semrush One - Combines the SEO Toolkit and AI Visibility Toolkit in one subscription. Track Google rankings, backlinks, and site health alongside brand presence across ChatGPT, Gemini, and Perplexity. Try Free for 7 days
Parcel Perform - AI visibility analytics for eCommerce brands. Track how your products rank across ChatGPT, Gemini, Perplexity, and Claude, then turn delivery and returns data into the trust signals that win the #1 AI recommendation. Get Demo
Events for your Diary
We're busy getting our event directory fully up to date for 2026... if you have an event we should be promoting, submit it here
Freshly updated with our top picks for the Autumn.
Want to advertise to our audience? We’d love to hear from you