how to calculate profit from shopify

what is up guys and welcome back to a,brand new video now i'm always getting,questions from people on instagram and,twitter about how they're struggling,with their drop shipping businesses and,e-commerce businesses in general and,that could be with google ads facebook,ads a lot of people might say you know,i'm getting a lot of sales and stuff but,i'm just not seeing any profit and the,first thing that comes to mind and i've,said to a few of these people already is,that they clearly don't truly know the,numbers of their business and i cannot,stress enough how important this is drop,shipping and e-commerce isn't just as,simple as you know selling something,paying for that product and a bit of,that profit that's obviously taken away,is marketing costs and a few other costs,involved in there as well probably for,most of us people don't take that into,account they always think you know if i,buy this product from aliexpress for 15,dollars and sell it for 45 i'm easy,could be making thirty dollars and that,is certainly not the case it's things,like transaction fees marketing costs,other overhead costs like web costs and,stuff like that that people just don't,take into account and then at the end of,the day they wonder why they're not,profitable and over the last two or,three years with my e-commerce journey i,can't stress enough that this is,arguably one of the most important,things is knowing your numbers now this,is speaking from experience not knowing,your numbers like your profit your,outgoings your in-goings can be very,very bad and essentially blind you from,what's really happening within your,business for example on my american site,about two or three months ago i didn't,use this particular app and i thought i,was making essentially a lot more money,than i actually truly was because i,didn't take into account foreign,transaction fees and things like that so,when i was roughly doing my profit each,month in my head and just on a little,spreadsheet here and there you know i'd,look at the number i think wow that's,been a really good month but in fact,looking back at it after seeing the,actual numbers it certainly wasn't the,case but luckily i've now been able to,implement things within my business that,actually have allowed me to grow,increased profit margins and things like,that and this particular app is called b,profit prior to using b profit i did use,about two or three other all-in-one data,tracking and number tracking apps for my,shopify store and i ended up just,removing them after a week or two,because they really weren't performing,how i wanted them to but luckily for the,last two or three months be profit has,been a great app to use in it and it,really has changed the trajectory of my,business so in today's video i'm going,to be going through a complete setup,guide for this app how you can install,it on your store and i'm actually going,to be revealing the profit my us site,mate and if we just switch over here i'm,sure a lot of you might be interested to,see this is today alone five and a half,thousand dollars in revenue now i'm just,going to refresh my screen here so you,know it's obviously not edited and,things like that i'm going to be going,through a complete setup guide how you,can sync your ad platforms to be profit,so you know truly how much you're,spending on ads each day obviously your,revenue and any other things you need to,take into account can all be added into,this app now for this video i'm,obviously going to do a quick setup,guide on shopify you can use be profit,on a variety of other platforms such as,woocommerce and wix but i'm pretty sure,most of my audience are shopify users so,that is what we are going to use today,i'll leave a link at the top of the,description for be profit you can even,use a code patch 30 when signing up to,get 30 off your first three months now,you can install this app directly from,the app store but to get the discount,you definitely should do it through,their websites you'll be on their,homepage like this now for the purposes,video i've removed the app so we can go,through a complete uh setup process,again all you need to do is click this,button here get b profit i'm going to,quickly sign up again you can see here,the code has already been applied as,well for the discount so i'll be back in,a minute once you've set this all up,okay guys once you've gone through that,setup process all you essentially need,to do is click your econ platform i,selected shopify and in my shopify store,url it will bring you to a page on your,shopify admin you literally click,install app and then you'll let it do,its thing now there are just a few steps,to get this app up and running you have,a few questions to answer for the,purpose of this video i obviously don't,want to reveal the products i sell but i,mean i'm going to go into full detail on,my profit my in-goings and outgoings for,my particular usa drop shipping site so,i'm just going to click other here,hit next and that will take us to the,next page you can then select your,marketing platforms as you guys know i,am big on google i also use facebook i,also use bing as well i have tampered,with pinterest and snapchat not,something i use at the moment not using,tiktok currently but i know a lot of you,probably do use tiktok so it's obviously,very good that that option is there as,well and if you are using other tools,such as clavia or google analytics you,can implement them as well okay guys,i've just gone through the process of,connecting my bing ads account my google,ads account and my facebook ads account,okay next up is pretty straightforward i,drop ship my products i use aliexpress,for some of them but i also use a,private fulfillment agent that does ship,about 80 percent of my products i also,use dieses to fulfill the aliexpress,orders so if we hit next right here,another pretty straightforward thing i,only use shopify shipping now next up is,another quick one about shipping i,obviously have pretty much no shipping,costs also i have clicked the top one,there and you can see commonly used by,drop shippers like myself i'm sure most,of you are in the same boat as well now,this next screen is quite important it's,essentially how you're gonna tell be,profit how much it cost you to ship and,fulfill each order i'm obviously blowing,out my products here but you literally,just need to enter here the number that,you will know of how much your first,problem how much each product costs,sorry so i mean for example here this is,a product i sell for 119,and i know this product cost me 53.77,all in so i would enter that value there,and you can go down each product and add,in the correct cost per item now this,one's very important because shopify,payments they automatically think that,there's a zero percent transaction fee,and essentially that is correct in terms,of they don't add any fee onto your,monthly bill for shopify but shopify do,take 2.9,of transaction fees from foreign,countries so as i'm based in the uk,every order i get on this site is from,america so i'm hit with 2.9,for every order i get from america and,then because there's a currency,conversion usd to great british pounds,that is an extra two percent so for me,the currency conversion rate and the,payment processing fees equal a whopping,4.9 percent which is very very large and,something i never thought to take into,account before so please make sure,you're doing that correctly and you can,see here with paypal that they do take,into account their typical transaction,fees but not things like currency,conversion fees but because paypal i use,to pay for my orders in us dollars i'm,not going to add that currency,conversion fee because i just keep the,balance in usd when people pay to paypal,so i've hit next here,we've almost done this out and then,we'll jump into the,you know the interesting numbers i'm,sure a lot of you want to see other,expenses you can add here you know,really important you've got your shopify,bill 79 a month you need to add all your,uh shopify apps into this as well if you,use things like clevia you can add that,into there if you've got any employees,you can or freelancers you know anything,that has like a a recurring cost,definitely add this into here because,that will give you a much more accurate,figure and just before we jump into the,main uh profit and stuff for this,particular website i am going to go in,and just add all these numbers it will,take me a while but i am going to do it,so i can give you guys the accurate,profit figure for this store okay guys,now once everything has been set up and,you've synced everything and you've,added your product costs and other,expenses you will see a,dashboard that looks like this very very,easy to use and you can simply see here,today i'm recording this on the 5th of,september and you can see my breakdown,for my daily profit today you can see,i've had 54 orders today a total of,almost thousand dollars in revenue my ad,spend today one thousand five hundred,and sixty six dollars cost of goods is,two thousand one hundred and eighty four,and transaction fees is a whopping 294,dollars i know it's crazy that is one of,the reasons i use this app is so i,actually know,where my money is going but that is,leaving me of a gross profit of 1721,if i just move myself out the way,quickly here that leaves me of a net,profit margin of 29.8 percent today,which i think i said in my last video,actually i currently operate around 25,to 30,which is very very good i mean,especially a number like that almost all,basically a 30 profit margin is what i'm,currently running at and thanks to this,app i'm actually able to know this,information because previously i was you,know making losses on some products i,thought i was making profit on but after,cost of goods had gone up i hadn't,realized after transaction fees and,marketing costs there were products that,i was selling that i was simply making a,loss on because i didn't know this,information so i cannot stress enough,how important it is to know your numbers,when it comes to not just drop shipping,but e-commerce in general now we just,scroll down a bit this is a sort of last,30 days overview of the store you can,see sales 151 000,very nice ad spend accounts for around,uh one-third of that total sales volume,and cost of goods is pretty much the,same around one third as well so it's a,nice sort of 33 percent split across my,ad spend cost of goods and then what,ends up being my profit margin but,obviously there are a few other expenses,here like my refunds that you need to,take into account transaction fees seven,and a half thousand dollars worth of,transaction fees absolutely ludicrous,but at least we now know that is how,much we're spending on transaction fees,or should i say not spending as such but,how much is being taken away from each,allah when it comes to transaction fees,and it breaks it down nicely here into,your net profit here which over the last,30 days has gone down a bit from the,daily profit today which is 30,like i said around 25 30 percent is what,we are sitting at but you can see the,last 30 days profit is almost 25,which at scale is very nice i'm,comfortable with that i'm very pleased,with that but previously i was running,at a much lower profit margin with the,help of this app i was able to increase,it by doing things very simply just like,upping the price of my products because,with google ads that doesn't really,affect the performance too much if you,do very gradual small increases some,products i've gone from selling for 48,they now sell for 68 they still convert,just as well but i'm now getting an,extra 20 or so for each order of that,product using this sort of data to make,informed data driven decisions is is,what's going to help take your business,to the next level now with be profit you,have the opportunity to create custom,reports again if you want to analyze,your data even further in a specific,area you can use custom reports for,things like products vendors either use,different um suppliers not just,aliexpress if you've got like contracted,supplies it's a very good option to use,you've got taxes here another very,important thing marketing platforms,again a very good report to see and you,can even tell them to email you your,daily profit each day which i absolutely,love i love waking up to this email let,me know how much i've made the day,before and that's why i've got this,turned on you can see i get that email,at 6am every day so by the time i've,woken up i'll check my emails i'll see,how much money i made yesterday such a,very cool unique feature and as you just,saw when we were setting up it's so easy,to integrate your ad platforms you know,i did bing facebook and google obviously,there are a lot more options there if,you use ticks ads this will be,compatible with you as well now one,thing i use with facebook ads and i need,to set this up again after this video,but you can use something called utm,attribution it's literally a little,snippet of code you add to your ads on,facebook you can do it on google as well,i personally only do it on facebook,because of the facebook tracking issues,google tracks conversions really well,but facebook as we all know since ios 14,is horrible it you know it's ruined,people's facebook accounts since that,happened but with utm attribute tracking,you can simply add on the facebook ads,page just at the bottom before you click,publish you can add a little snippet of,code and that will essentially allow be,profit to track your facebook ads,conversions better than facebook do,themselves you can analyze that data in,here another very good important feature,for not only just simply analyzing your,daily profit but actually analyzing the,performance of your facebook ads because,as we all know facebook even my facebook,only tracks about 40 to 50 of the,purchases whereas this you know that's,double that it's so much more accurate,and again allows me to use facebook,almost like the good old days when it,actually tracked every single conversion,and of course guys like any good app i,use on shopify if there's anything you,need help with whether that's,integrating your ad accounts whether,that's setting up your product costs or,if you're integrating aliexpress,anything like that just drop them a,message on the live chat here bottom,right you just click that they're super,friendly they're super helpful and,they'll fix or help anything with you,within just a few minutes so i can't,recommend them enough and the reviews,speak for themselves on b profit they've,had over 255 star reviews on the shopify,app store and as i've mentioned in my,previous videos i'll never suggest or,recommend anything to my audience on,youtube that i don't use myself and i'll,only recommend it if i truly believe it,will benefit you growing your business,whether that be e-commerce in general or,drop shipping and as i mentioned earlier,on in the video check out the top link,in the description to sign up and get,started with be profit today that link,will automatically get you a 30 discount,on your first three months or if you,need to apply the code just apply code,patch 30 when you're signing up it takes,a couple of minutes to install but once,you get it going it really will help,drive your business forward in the right,direction and it will truly open up your,eyes to what is happening within your,business good or bad if it's bad you,know there's things to improve and at,least you have now identified those,issues exactly like i did some of the,products i mentioned earlier so i hope,you have enjoyed this video and found,this useful drop a comment down below if,you guys need any help of anything and,do check out the link at the top of the,description to get started with be,profit today thank you very much for,watching and i'll see you in my next,video,you

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