Understanding Cost Price and Profit Margins
Knowing exactly how much money you are making is the key to scaling your business. Foliodia calculates your net profit automatically, but it requires you to input your exact Cost Price for every product.
Overview
Your Cost Price is how much it costs you to acquire or manufacture a single unit of a product. By subtracting this from your Selling Price (which you define inside your Offers), Foliodia determines your exact profit margin per sale.
Before You Begin
Calculate the true cost of your item. Include the wholesale price, shipping materials, and any landed costs required to get the product ready for the customer.
Step-by-Step Instructions
- Navigate to Products: Open your dashboard and go to the Products tab.
- Edit a Product: Click on a product to open its details.
- Locate Cost Price: Find the field labeled Cost Price.
- Enter the Value: Type in your true cost per unit.
- Save: Click Save Product.
Note: Foliodia will automatically use this Cost Price in all future orders containing this product to calculate your Analytics.
Tips & Best Practices
- Update Costs Immediately: If your supplier raises their prices, update your Cost Price in Foliodia immediately. Foliodia preserves the historical cost price in older orders, ensuring your past profit analytics remain 100% accurate while applying the new cost to future sales.
- Factor in Shipping: If you offer "Free Shipping" to your customers, remember to bake the average shipping cost into your Cost Price to get a true picture of your profit margins.
Common Problems
My profit numbers in Analytics show as $0 or are too high. If you leave the Cost Price at $0, Foliodia assumes the item was free for you to acquire, meaning 100% of the selling price is marked as profit. Ensure all products have an accurate cost price.
Frequently Asked Questions
If I change the Cost Price today, will it affect my profit reports from last month? No. When an order is placed, Foliodia takes a "snapshot" of the Cost Price at that exact moment. Changing the Cost Price today will only affect orders placed from this moment forward.