How to Perform a Profitability Analysis for Your Shopify Store?

An accurate profitability analysis will give you important information on how your store is actually performing so you could make improvements to your business’s profits and losses.

So in this article, I’ll talk about everything you need to know for how to perform a profitability analysis for your Shopify store.

Why is doing profitability analysis important?

If you do it properly, a well-thought-out profit analysis report will give you a 360-degree view of your store’s actual performance in making profits and any elements that influence your profits. 

And from the findings in your analysis, you can identify the parts where you’re doing good and map out the areas where you need to improve. 

Therefore, if you want to find growth opportunities and round up your bottom line, I suggest you do your profitability analysis frequently.

Methods of Profitability Analysis

There 2 main methods to perform your store’s profitability analysis – via ratio or break-even analysis. 

Because each method involves different metrics and each metric is meant to play a different role, I highly suggest you do both methods to have a clearer understanding of how your store is actually performing.

Method 1: Ratio Analysis

Ratio analysis analyzes both margins and returns ratios. The ratios are examined both individually and in comparison to industry expectations. 

Margin ratios concern profit margins at various levels, whereas return ratios concern how well a corporation uses its resources to produce money.

In general, the larger the ratio, the better.

Gross Profit Margin           = Gross Profit / Sales

Operating Profit Margin    = Earnings Before Interest & Tax (EBIT) / Sales

Net Profit Margin              = Net Income / Sales 

  • Gross Profit Margin is the amount of your sales revenue minus the cost of your goods. The ratio assesses how successfully you manage stocks and product manufacturing costs. It is also used to assess your company’s capacity to pass on the cost of goods to your consumers.
  • Operating Profit Margin is another margin ratio that is used to measure how well you’re managing your business.
  • Net Profit Margin is the most commonly used margin ratio and is the percentage of net income to sales. This ratio takes into account net income after deducting all your business expenses.

Return on Assets = Net Income / Total Assets

Return on Equity  = Net Income / Total Sharehoders’ Equity

  • Return on Assets (ROA) is a return ratio that shows your capacity to create profits from given assets
  • Return on Equity (ROE) is a return ratio that shows how much money your company has made for your investors

Method 2: Break-Even Analysis

Your break-even point is the point where your costs equal your revenues. At your break-even point, you’re neither making a profit nor losing money. And that’s why the break-even point (BEP) is widely used as a safety metric to measure how much you need to earn at least to keep your business operating.

Handy tips to do your profitability analysis successfully

Doing profitability analysis isn’t as easy as you might think. 

But don’t worry! I’ve got you covered with 4 tips so you could carry out a proper profitability analysis and make improvements based on your analysis.

Tip 1: Learn from your past data

After you’ve completed the calculations for your latest figures, remember to review your profit levels from past years and quarters.

Although your present figures may appear to be satisfactory on hand, you need a benchmark to compare them to. By comparing your current data to your prior performance, you’ll be able to determine if you’re on the right track and what areas you can improve on.

Tip 2: Compare yourself to competitors in the same niche

Comparing your profit and losses over different time ranges is not enough. To make sure you’re doing fine, you need to put yourself and your competitors on the same scale too.

So always research your industry ratios so you can know where you are compared to where you want to be in your niche.

Tip 3: Take action on your findings

If you can create an accurate profitability report, spend time analyzing your own findings. Afterward, brainstorm with your team all the abnormal ups and downs that you can fix and improve on.

Tip 4: Use a profit-tracking solution

There’s nothing wrong with tracking your profit and losses with Google Sheets. However, performing a profitability analysis using Excel or Google Sheets requires you to collect data from many different sources – which makes your analysis report error-prone and time-consuming.

So to perform a profitability analysis with accuracy, you need a good tracking solution, which I’ll cover right below: 

4 best profit-tracking apps – do your profitability analysis with ease

I’ve tried tons of profit-tracking solutions, and here are the 5 apps that bring me the best experience ever!

1. TrueProfit – True Profit Calc & Analytics 

The first solution I’d love to bring to today’s list is TrueProfit – a tool I’ve used for over 3 years. This app pools all my costs, expenses, and revenues in one place and automatically updates the latest data any time there are any changes. 

By tracking my store’s crucial metrics like all profits & losses, Customer Lifetime Value, ad spend, etc. I could have a better view of how my store is actually performing and the areas I can improve.

Featured Highlights

  • Track all profits and losses with automatic updates to show your store’s true profit in real-time
  • Sync ad spends from Google, Facebook, Instagram, Twitter, Amazon, etc. to show you your ad spend and ROAS on each ad channel
  • Show you your best selling products and most frequently bought together combos
  • Calculate Customer Lifetime Value, Cost to acquire a customer so you know which product lines and customers groups to invest in
  • Fast and amicable customer team. I once had a technical issue with importing my COGS data and they helped me through it step by step

Price: From $19.95/month. 14-day free trial

2. Profit Calc – Profit Calculator & Auto Syncing

Profit Calc is another reliable Shopify profit tracking tool that helps you track your store profits fast and accurately. What I like about this tool is that the dashboard is easy-to-use with all the data beautifully visualized for you.

Just like TrueProfit, it can automatically sync with your Google, Facebook, and Bing ads, as well as other advertising channels, to cover all of your ad spendings in profit estimates.

Feature Highlights

  • Calculate shipping costs for each country.
  • It has a Chrome plugin that allows you to sync your AliExpress orders as COGS
  • It automates the calculation of credit card fees and transaction charges.
  • The app includes a monthly expense tracker, allowing you to identify and eliminate needless spending in order to enhance cash flow.

Price: $29.95/month.15-day free trial

3. SimplyCost ‑ Profit Tracking

SimplyCost is one of the best profit-tracking apps on this list. The app allows you to calculate your store’s crucial metrics with high accuracy. 

What is great about SimplyCost is that it has a lot of valuable reports that break down your costs, revenues, and profits by different products, vendors, POS locations, etc. 

More importantly, if you’re on a budget, perhaps this app is made for you since it only comes with one pricing plan at $4.99 per month.

Features Highlights

  • Add cost price to your Shopify store
  • Automatically calculate your profits and losses
  • Import your data to the app fast and with no error
  • Break down your costs and revenues to have a better understanding of your store’s important metrics

Price: $4.99/month. 14-day free trial. 

4. BeProfit ‑ Profit Tracker

If you’ve done a bit of research, you’ve probably heard of BeProfit. This is one of the most popular profit-tracking solutions on the Shopify App Store. The tool offers an all-in-one analytics dashboard so you could manage and closely monitor all your earnings and expenses. 

The app does a nice job of converting complicated data into simple charts and graphs so you could digest them more easily. 

Plus, the app also comes with seamless integration with all ad platforms to show you how effective your ad performance is.

Features Highlights

  • Accurately calculate profits and losses in real-time
  • Track all your expenses in one place
  • Beautiful charts and graphs
  • Track ad spends seamlessly to know your ROAS
  • Calculate your Customer Lifetime Value 

Price: From $25/month. 14-day free trial. Free plan available. 


Above is everything you need to know in order to do a profitability analysis properly. Though you may need to spend some extra time analyzing your company’s crucial metrics, your effort will eventually pay off if you know how your store is actually performing and where you could improve to round up your bottom line.

5 Proven Shopify Filters & Search Tips To Skyrocket Your Holiday Sales

With the current 41-year high inflation rate in the US, our customers and business are facing a tough call in finance. You might struggle with different ways to maintain your Shopify store’s profit margins. Higher prices and less stock also shoo away our customers. 

Fear not, my friends. There are plenty of ways to squeeze more conversions and increase sales when customers are spending less. Plus, ‘tis the festive shopping season upon us, and even the most hesitant shoppers will be more likely to open their wallets. 

To set up your Shopify store and get ready for the extreme shopping in the upcoming holiday season, here are my 5 proven tips to optimize your Shopify filters and site search for the highest sales possible.

1. Optimize Shopify filter options for holiday selling

Many Shopify store owners run through default Shopify filters once when setting up the store and forever keep them that way. I know many of you tend to neglect Shopify filters and filter options believing products and marketing are the main factors that affect your store’s overall revenue. 

Well, you’re not wrong. But you’re not 100% right either. When a crisis hits, you’ll need to cut down your marketing budget or be pickier in choosing which product line to put on your shelf. Otherwise, You end up hurting your business. 

I myself am a conversion maniac (honest confession). Thanks to that, I did my research well enough to optimize everything on my Shopify stores. And let me tell you, optimizing Shopify filters is the secret weapon that helps you earn more – even when you’re running a small business – while not breaking the bank in storefront infrastructure. 

Prepare your store filters for the holiday season

Here’s what I did, ten thousand times: 

Dive into Shopify analytics and figure out which product details (hint: look at the top search terms and top clicked filters) are on top of your shoppers’ minds. Put them on top! Suggest them to your customers.

In general, shipping information, on-sale items, stock availability, and gift guide collection are among the most selected filter options to display during the holiday season. People shop for gifts to look for items that are ready to ship, cheaper, and holiday-themed. 

Next, do your homework and A/B test the effectiveness of your new prioritized filter options. Rinse. Repeat. 

2. Offer filter and sort options on different pages and positions

Usually, you’ll see Shopify filters on the left side because the left side area more easily catches the shopper’s attention. There’s research for that: 69% of consumers spend most of their time looking at the left half of the page.

Do you think the left-side filter is enough? 

You’ll need to display and optimize sorting options too. And for sorting options, you’ll see most stores display them on top, horizontally. 

In my experience, it’s best to display filters and sorts strategically depending on each page. On the Shopify collection page, I opt for a simple horizontal filter bar with fewer filter options. 

On the search result page, I’ll go with full filter options with a left sidebar filter tree. Because that’s when visitors are in “search mode”. They need information! 

Always ready to let customers search for more based on their preferences

Pro tip: If your product has too many details and specifications, you should group them into collapsible menus. This way, your store looks neat, and less cluttered while still allowing online shoppers to filter their desired items when needed. 

3. Optimize the search box and filters for the personalized search

I can’t emphasize enough the importance of selling “experience”. If you want to optimize Shopify filters for a better conversion rate, go for personalization. Spend your time on Amazon to see what I mean. Amazon does an excellent job of guiding customers’ shopping experiences.

Amazon search is always my favorite search personalization

Optimize your Shopify store’s filters:

Let your store visitors save and edit filter options by their preferences. Don’t simply rely on side-wide filters. My best practice here is to provide product-specific filters that relate directly to the user’s query through Shopify faceted searches, such as category, price, and brand. 

Don’t forget the holiday shoppers though. 

Pick your store’s bestsellers and create as many holiday-themed collections with these items as possible. You can personalize these collections by tailoring them to the customer’s language or search intent, for example, “Best Ugly Sweaters for Mom“.

Optimize your Shopify store’s search box:

Let your shoppers search the way they want to search. Use search synonyms to display alternative spellings so you can always give customers what they’re looking for quickly no matter what keywords they use. 

For example, you sell headphones but customers can enter “earbuds”, “headset”, “can”, or “headpiece” and still find their wanted headphones. 

This applies to brand names too. If you are a wholesaler of many different brands, pay attention to what your customers may call these brands.

For example, people refer to “Woolworths” as “Woolies” so you may consider adding “Woolworths shoes” as a research result for “Woolies shoes” query entered by customers instead of showing “No Results Found”.

Also, don’t expect customers to enter the perfect keywords. Because they don’t. You’ll need to allow typo tolerance and spellings for your search box. Plus, a smart personalized search will automatically suggest the keywords as shoppers type. 

All of these search and filter personalization and optimization can be done easily via a powerful Shopify filter & search app like Product Filter & Search by Boost Commerce

4. Utilize online merchandising to foster promotional campaigns

My all-time online merchandising trick to apply for the holiday selling season is optimizing product ranking

First, you need to update your targeted products with holiday-related keywords in the title, description, tags, etc. Then, use merchandising tools to display holiday-themed products and collections first thing in your search box suggestion as well as on the search result page

My veteran’s online merchandising secret reveal: Upsell and cross-selling!

Group products in bundles and name them in a holiday category to sell more. These bundles or collections should be put on top in your filters as well as search suggestions too. For example, prioritize displaying products that have discounted bundles and free shipping. 

Prioritize your holiday-themed items, seasonal trending items, or bestsellers to gain higher sales

5. Optimize loading speed for Shopify filter and search

Holiday season = peak traffic season. 

It’s a big turn-off for your store visitors if it takes more than 3 seconds to load. There are many things you can do to ensure your site speed during the busiest traffic time of the year. 

Owning different Shopify stores from a few hundred to thousands of items, I can say that the best practice is to stay with a lightweight (still, powerful in functions) Shopify filter app with a high-performance infrastructure. 

You’ll need an app that syncs and update your changes in real time and let users browse through a sea of product listings in a matter of milliseconds. My go-to solution is an AWS-powered Shopify app like Product Filter & Search. Secure. Fast. Does its job exceptionally. Many white hairs were saved! 

Here’s to your next big winning holiday selling!

Believe me, preparing for holidays is no walk in the park. No matter how big or small your Shopify store is. If you’re looking for a highly effective and cost-saving solution to drive more sales, take a step back and look at what you already have. Then, improve from there. 

Optimizing Shopify filters and search is my fool-proof tactic for years in winning more sales without investing too much. Do you have your own little holiday sales secret? Let’s share!

6 Elements of A High-converting Product Filter & Search App

Did you know that site searchers can convert up to 5-6x higher than the average non–site search visitors and shoppers who use product filters convert 2-3 times more than those who don’t?

After many years of working with merchants in many verticals, I discover one common mistake eCommerce start-ups usually make: Overlook the impact of an innovative product filter & search solution. It’s not all about an increase in sales and revenue. Nice and easy on-site product discovery also helps with boosting shopping experience and customer retention.

Most concerns when it comes to investing in a product filter & search app are how to pick the right one and how to know if it works. If you have the same questions, the following are my top 6 Elements of A High-converting Product Filter & Search App for your consideration.

#1: Various Filter Options With Diverse Display Settings

Although site searchers tend to convert better with high purchasing intent, it’s difficult (and even annoying) if they can’t narrow down the result list using preferred criteria. That’s how important Product filters and Sort by options on collection pages and search pages are.

The thing is, simple filtering criteria like price, and product type are not enough. The top 5 essential product filters that work for most eCom businesses from my observation are:

  • ​​Price
  • User Rating Average
  • Color
  • Size
  • Brand

What you need is an app that allows you to easily create these filters and more. Filter by Tags and Filter by Metafields are two simple ways to expand the filtering capabilities that a leading product filter app should have.

Look at the examples below. Besides some basic filter options, the wine online store (left-hand image) adds industry-specific filters (Body) to enhance the filtering experience. When using industry jargon in the filter tree, you’d better have a tooltip to explain what it is like in the e-sport gear store on the right-hand image.

Industry-specific filters are excellent add-ons but you need to be careful with them

When I work with Shopify stores specializing in Fashion, they usually have problems with Color filters. They use a bunch of different words to precisely depict the color of the products such as green, olive, and emerald. This leads to a long and confusing list of filter values. Honestly speaking, can you visualize the difference between all the green shades just by their name?

Average shoppers probably can’t. As a result, you need a filter app with a Swatch filter so you can display the color palette or even upload images to demonstrate the color or pattern.

The Color filter here is brought to life with the image upload

In some cases where the difference between the filtering values is minor, you may want to merge these values to make the filter tree neat and clean.

This store merges some consecutive values in the filter by size

#2: Search Merchandising Capabilities for Products and Attributes

Similar to the window display and store layout in in-store merchandising, the eCommerce counterpart plays an important role in boosting online sales. Thanks to the increased level of purchase intent from searchers, search merchandising is known to bring more conversions. That’s why it’s my top #1 feature of a high-converting product filter & search app.

The default search solution usually lacks merchandising options for search results. This means no simple way to alter the order of returned products. These issues are addressed by third-party solutions, which include built-in capabilities that enable retailers to appropriately “searchandise” their results and change the product rankings according to certain criteria.

Shopify filter & search app like the one provided by Boost Commerce allows users to promote products based on specific rules (like inventory, price, tags, metafields), and also assign ranking for specific items (e.g. pinning Black Long Dress across all relevant queries).

#3: Effective “No Results” Workarounds That Keep Shoppers Engaged

A smooth shopping experience is the first and foremost in customer retention. Just imagine how frustrating it is when you’re excited to find a new outfit for a date but all you get is literally NOTHING!

Therefore, leaving customers with a blank “No Results” search should be avoided at all costs. An optimal product filter & search app should offer many ways to overcome this issue and provide an uninterrupted shopping experience.

A helpful feature for the “No product found” dead-end that I think is important is the ability to add suggested listings. Suggesting other products and pages that are most related to users’ queries, rather than only displaying “No results” or “Sold out” pages, is a better way to keep customers engaged.

In my opinion, either auto-suggestions based on store data (best-selling products, most recent searches) or manually added suggestions work perfectly in case of searches without results. The latter will be helpful when you run promotion campaigns for particular products and want them to be seen as much as possible.

One way to nail the “No results” page is with an instruction message and auto-generated popular searches

And don’t overlook such tiny details as the “No products found” message. Squeeze any chance to communicate with your customers as a person, not (speaking in WALL-E voice) as a machine.

#4: Predictive Autocomplete With Typo Tolerance For Faster & More Relevant Results

We all know that most third-party site search engines include predictive JavaScript search interfaces. So what is the difference? The outstanding feature you should look for?

The conversion boosting element lies in the speed.

An advanced app will be able to support hundreds of thousands of products and still return results quickly and in a variety of formats. On mobile devices especially, this can have an even greater positive effect on the entire user experience. This example shows a rich instant search interface that allows for collection results, query suggestions, and also content results. You can also see that discounted prices are being displayed.

The predictive search can kick in after just two or three characters have been entered. It brings the most likely results right to the customer’s immediate attention, with various product attributes such as thumbnails, various naming fields, configurable options (such as price, color, and size), and product labels (as can be seen in the Red Dress example below).

ONE MORE FACT: the fastest search can still fail if it couldn’t deliver relevant results.

So, what’s more important about an efficient Shopify search app is to be able to handle errors without manual interception.

With strong error tolerance, onsite search still delivers fast and accurate results for misspellings like “ligth” (correct spelling is “light”) as in the left-hand image. When the error margin is wide like “enrgs” and “energy” in the right-hand image, a “Did you mean …” message will be displayed.

#5 Comprehensive Analytics for Search & Filter Engagement

It’s crucial to know the value of your investment in a third-party app for product filter & search offerings. Robust analytics also provide a deep understanding of your shoppers’ behaviors. From that, you can implement further optimization to make the most out of the app and get more sales.

Some of the reports and metrics I’d advise you to look for when choosing a search & filter solution are:

  • Query usage and search term counts
  • Top-performing queries 
  • Queries without results
  • Filtering usage and number of filters used
  • App impact metrics (this can be sales/conversion generated by search and filter activities)

“Top filter option values” compiles a list of the most favored product attributes that shoppers use to narrow down the product list. It tells you which aspects of your offerings are the most attractive from the customers’ point of view. Then you can put the top clicked values in the first places on the filter tree so shoppers can easily use them.

The “Top search terms” report record phrases that are entered the most. These are highly likely your best-selling items. So grasp any chance to boost sales from them with merchandising. Moreover, carefully check the “Top search terms” within a certain timeframe to spot trends or spikes.

Reports for “Search terms without results” are worth your attention too. One of my clients noticed that many customers were looking for a vendor that they were not providing at that time. This was a hint for them to expand their product categories. They actually started connecting with the vendor and selling their products with profits after that.

During BFCM, shoppers usually search for BFCM, Sale, and Discount so you can create Search redirects for these search terms and their synonyms such as “BF” to route shoppers to the Black Friday promotion collection.

Above are a few examples of insights that my clients have gleaned through data from third-party search providers. Many of them have made significant and measurable gains thanks to regularly analyzing and acting upon the filter and search information.

#6: Top-notch Support & On-demand Customization of High Quality

Besides app functionalities, support, and other services are what you need to consider when choosing a search & filter solution, especially when your business is on growth. So, picking an app with a professional support team that can help you with custom requests is among the top priority.

Since traffic spikes during holiday seasons are not a new thing, I personally would love to get an app whose support team is fast and offers premium AWS infrastructure (to guarantee the app can handle any traffic peaks).

If you’re looking for an app that meets all the 5 criteria above and has a well-trained support team, I recommend Product Filter & Search from the Boost team.

The Boost team has done a lot of customizations for my search filters since I got the app for my jewelry store. These include the full result set right there in the dropdown, with scrolling and faceted search filters and even an add-to-cart button and many small details.


Enhanced filter options together with a smart and powerful site search engine are a must-have in a thriving online store. Keep an eye out for the following features to be able to pick the right one:

  1. Industry-specific filter options with advanced settings
  2. Search merchandising
  3. Zero-result suggestions
  4. Instant autocomplete with Typo tolerance
  5. Insightful analytics including app impact
  6. High-quality technical support for custom requests

8 Secret Tips To Quickly Boost Your Jewelry Store Sales To New Heights

Black Friday and Cyber Monday, the busiest shopping days of the year, are almost approaching. Whatever your feelings about Black Friday, millions of people will be shopping online, and this is an excellent opportunity to remind them about your jewelry and business. 

Most people have already begun preparing and creating their BCFM 2022 shopping list.

Are you ready to pique their interest?

If not, start soon or risk losing them to your competitors. Using the correct methods and ideas, you can turn this Black Friday sale in 2022 into significant profits for your jewelry business.

Here are some tips for making the most of this season.

1. Create a User-Friendly and Aesthetic Jewelry Website

Remember that potential shoppers will first view your website when they browse your jewelry. Therefore, you want to be sure that it conveys the right message and makes a good impression. You should also ensure that your jewelry website is shopper-friendly and easy to navigate. 

On the other hand, the usability of websites is equally as vital as their aesthetic appeal. It’s essential for SEO. In recent years, Google has made site experience and page speed critical ranking factors. One of the most noticeable and crucial ranking considerations is how your website design appears on mobile versions. 

It doesn’t matter how you attract visitors to your website if you don’t make it simple for them to buy your jewelry or add items to their basket. Making your website as user-friendly as feasible is crucial.

Ideally, I try to include product labels to catch customer attention, and that’s a clever choice. The important thing is to help them quickly find what they want. Otherwise, you risk losing their interest and even preventing them from making a purchase.

With Product Labels & Badges, I can show my customer which products are sales right from the product images during the BFCM campaign. Primarily, I can design labels & badges to match my brand identity instead of pre-made ones. However, you can also choose from 3000+ labels, which are updated weekly, to save time and effort.

2. Optimize For Search and Organic SEO 

To increase your sales, you can also strengthen your organic SEO. By optimizing your website for particular keywords, shoppers will discover your website when looking for jewelry-related products. Customers using search engines to find what they’re looking for will be able to connect with and use the keywords and phrases to their advantage.

The key to ranking well is on producing great content that motivates website visitors to click on a CTA to make a purchase. To help your site rank higher organically, use the Ahrefs keyword search tool to locate words and phrases in the content. Since more people view your content in online search results when you rank higher, you are exposed to new audiences online who might become customers.

Another approach is to use “guest posting” to request recommendations from current customers. In this manner, you may include connections to their websites on your own and encourage them to do the same. 

3. Offer Attractive Discounts

Introduce jewelry store sales on your collection for both new and returning customers.

Make the discounts “urgent,” which means they should only be available for a limited time. Consider limiting your stock this Black Friday and ensuring everyone knows it. Scarce resources assist you in creating urgency, inspiring action, creating an “exclusive” sensation for buyers, and, probably most importantly, avoiding the need to price your products dramatically.

By using product labels such as Few Left, Limited, etc., you can encourage shoppers to do transactions with your business as fast as possible. 

For example, I use BFCM labels from Product Labels & Badges to lead customers to the products I want to boost sales because eye-catching labels will catch their attention first. 

Also, since I don’t sell off my the entire store, I used Black Friday and Cyber ​​Monday labels to put on the items included in this program. In particular, you can attach as many labels to the product image as you like. This is extremely useful for multi-category stores like jewelry stores.

Furthermore, bundling complimentary products is a terrific method to enhance your revenue during Black Friday promotions rather than discounting a single product. Ideally, you’d have a low-cost, high-margin product that you can bundle with your main offer to make it more appealing.

4. Use Email Marketing to Reach Your Audience

It’s an excellent tactic since it lets you connect personally with your customers. You can send your customers newsletters or emails at any moment. 

Marketing is not a one-size-fits-all approach. However, just as your jewelry and brand are unique, so can your jewelry marketing plan. Email marketing is an excellent method to connect with your customers, and the more personalized you can make it, the more engaging it will be. It also aids in the development of a loyal consumer base.

In fact, email marketing can be used to increase jewelry sales in a variety of ways. Send a monthly message to subscribers, including links to product pages and information about forthcoming events or sales. 

For example, you can email your subscribers exclusive promotions and sales events. At the same time, others can then remind them about your products and pique their interest in acquiring them again.

5. Use Loyalty or Referral Program To Increase Repeat Transaction

Of course, you adore all your customers, but you are most likely mainly devoted to your loyal clients—those who come time and again to purchase jewelry from you. 

Customer retention is priceless, and it is significantly less expensive to keep consumers than to recruit new ones. A loyalty or referral program is an excellent method to express your gratitude and keep customers coming back.

Use loyalty program software links with your website and other technologies, such as your point-of-sale (POS) system, to implement this jewelry BFCM idea. These programs allow you to collect consumer information for future email marketing campaigns and automatically reward customers for repeat business. 

6. Focus on Building Brand

A well-known and well-liked brand is one of the most precious assets a jewelry store can have. Furthermore, 59% of customers prefer to buy new products from famous brands.

As a jewelry store, you could compete with top brass, committed consumers, and unlimited marketing resources. As a result, you must seek out opportunities to shine – through your effective brand-building strategy.

But how might branding help to boost jewelry sales?

For me, building brand identification and trust around that identity are the two high-level aspects of branding. Brand identity elements should be applied consistently across all channels, including your logo, website design, patterns and icons, colors and fonts, and marketing campaigns.

Moving forward, you may magnify your jewelry store’s brand identity and cultivate trust value around it using a variety of digital marketing activities such as social media, SEO, and content marketing. Email marketing and paid advertising These approaches, taken together, are essential for developing a trustworthy brand.

7. Invest in High-Quality Jewelry Images

You must invest in high-quality jewelry photography to propel your jewelry business forward. Professional images will help you sell your items online and in shops, which may make or break your ability to attract new customers. High-resolution photos should be at the top of your list when considering how to advertise jewelry.

When photographing jewelry, there are a few things to consider. First and foremost, lighting is crucial, so choose a bright, sunny day or use a nice photography light. For crisper images, use a plain background and avoid using too much magnification or editing tools, which might soften the intricacies of your jewelry.

Above all, make sure your jewelry is in good condition! Use objects and backgrounds to enhance your work, and take a lot of images to find the greatest ones. You’ll be able to show off your jewelry in the best light with a bit of practice and some high-quality photos.

Of course, if you don’t feel confident in your photography skills or don’t have a good camera, don’t be afraid to contact a professional photographer to picture your jewelry.

Excellent photography is required for a successful jewelry BCFM strategy. It’s necessary for all your marketing channels, including your website, social media, email correspondence, and newsletters.

8. Create Relationships With Influencers to Market Your Jewelry

Social media is a feasible BFCM marketing idea. Still, if you’re not comfortable photographing yourself wearing your jewelry or your social media abilities are lacking, there is another method to enter the market. Consider collaborating with Instagram influencers and other social media content makers to advertise your jewelry.

Begin by establishing a relationship with an influencer who matches your jewelry line’s aesthetic or your brand’s stories. Follow them on social media, engage with their posts, and demonstrate an interest in what they have to say.

Pitch cooperation once you’ve established a friendship. You’ll have to pay influences, just like you would to a model or an actor, and you can expect them to wear your jewelry in public, pose for photos or make videos with your products, and (ideally) create a buzz about your wares.


A well-executed BFCM campaign not only helps you attract new consumers but will also help you create stronger relationships with those you already have. Understand it, and as someone who has tried many methods, I have drawn eight effective strategies to help you grow your brand. Use these suggestions to develop a BFCM plan that works for you and your brand, and then watch your sales skyrocket.

You don’t have to implement every marketing strategy on this list to attract customers and sell more jewelry. Instead, apply the concepts that make the most sense for your business. A well-designed website, regardless of the sort of jewelry company you have, will provide a robust online presence for buyers to find your business. 

On top of that, I believe using product labels has helped immensely with my BFCM campaigns, such as assisting in categorizing products, attracting attention, and creating a sense of urgency. One last word, I hope you will succeed with my tips. 

11 Practical Tips and Examples to Design a Black Friday Landing Page

One of the most important shopping days of the year is Black Friday. Even if it means standing in long lines, savvy shoppers look forward to the deals. Brands all over the world take advantage of the shopping frenzy by slashing prices left and right.

This day is the official start of the Christmas shopping season. So, if your business is related to eCommerce and retail sales, it’s crucial that you prepare your platform for the crazy shopping season to come.

So, if you want your own efforts to be rewarded with an increase in sales, you must do your best to ensure that your Black Friday deals receive the necessary client engagement.

Black Friday is the one day of the year when you can earn a lot of money while also lowering the cost of your inventory. You can entice customers to make a purchase if you create a dedicated Black Friday landing page.

Thankfully, there is no need to create the wheel from scratch. You can generate a ton of sales by simply adhering to useful advice on how to design an effective Black Friday landing page.

Before I get into the specifics, it’s crucial to understand that promoting your Black Friday deals involves more than just designing an appealing website.

A clever marketing and social media campaign must be developed in advance of the two days of crazy shopping. These social media platforms can increase traffic to your Black Friday landing page, increasing the likelihood that you will achieve impressive sales figures.

I. What Is A Landing Page?

Your website’s landing pages are web pages created especially for a marketing campaign. A landing page, unlike any other page on your website, is created with a single conversion objective in mind.

Its objective may be to persuade visitors to buy something from you or to join your email list.

A landing page is an ideal option for advertising and marketing campaigns because of its specificity. Directly directing Facebook Ad traffic to your homepage is equivalent to flushing your money down the drain.

A landing page created especially for a single conversion objective converts much more frequently than your homepage or any other generic page.

With different page designs and content, landing pages let you market to a variety of demographics. The higher your conversion rate, the more specifically written your copy is for a particular audience.

In fact, Hubspot claims that businesses with 30 or more landing pages produce 7 times as many leads as those with just 10.

II. Tips to Design Black Friday Landing Pages

1. Make Your Message Simple and Clear

When creating an effective landing page design, the emphasis should be on a single product, service, or event. Since we’re talking about how to create a smart and catchy Black Friday deals website, it’s critical to focus on the comprehensive presentation of your deals.

2. Keep the UX Design Simple

Building an effective Black Friday deals website entails simplifying the user experience and delivering a stress-free online purchasing experience. Keeping the number of items displayed on your online store to a minimum increase the likelihood that users will notice your selling points and make positive purchasing decisions at the end of their browsing sessions.

3. Make It Quick-to-Load

A web user will not wait a minute for the content of your Black Friday website to load. A person’s decision to stay on your online store and browse through your content takes no more than three seconds. A black Friday landing page is a page designed to entice your web audience to convert at the end of their browsing session. As a result, the quicker your content loads, the better.

Source: mngroup

Furthermore, when developing your Black Friday deals website, ensure that it can flawlessly adjust content to all screen sizes. According to the most recent eCommerce statistics, the use of smartphones for online purchases is skyrocketing.

4. Run Page Loading Tests Regularly

It’s essential to monitor loading speeds, especially during the busy season of Black Friday sales. Whatever changes you make to the landing page design, make sure they do not slow down your site. Even if you haven’t made any recent changes, if you notice a drop in customer activity or lower sales figures, test the page loading speed. A tool like Google PageSpeed can tell you how quickly a web page loads on desktop and mobile devices.

5. Keeps CTAs Clear

When it comes to the organization of calls to action on your website, make sure that your main message is clear to your visitors. CTAs should be simple to find, even for first-time visitors. These must be obvious and compelling so that your visitors understand what actions they must take without much thought.

When discussing the most effective examples of clear CTAs, I can mention structures like Byt Now, Sign Up, Book Here, and so on. These are simple enough that people will understand what to do next and what will happen once they click through.

6. Navigation as Promotion

One of the most common mistakes advertisers make when developing a Black Friday deals website is removing any extra navigation elements. Instead, you must draw your customers’ attention to all categories of items that can be purchased at a reduced price. You can either add navigation patterns to banners or place a standard navigation bar with Black Friday deals on your website. People will be able to notice which deals appeal to them the most and navigate to the appropriate catalogs or pages with a single click.

7. Place Banners above the Fold

The Black Friday weekend is one of the busiest shopping days of the year. Online shoppers are eager to find the best deals available. So, in order to get their attention and make them stop and stare, you must use the best bold banners displaying your giveaways, offers, and deals.

8. Headline and Content

When customers land on your page, the headline is the first thing that catches their attention – you need to announce subtly for the visitors the reason for running this landing page, normally, it is the best way to put the BLACK FRIDAY SALES or CYBER MONDAY SALES with bold and large text in the page space.

9. Background Picture, Video and Theme Color

Remember to create an appealing yet simple background for your landing page. With a beautiful and consistent design, you can raise brand awareness.

10. Mobile Layout

People nowadays do everything with their smartphones. As a result, merchants must always adopt a “mobile first” mindset. Assume that when a user searches for “Black Friday/Cyber Monday Sale” on their mobile browser, your landing page will be able to display the results.

11. Make Use of Page Builder Shopify App for Landing Pages

A landing page builder typically provides a simple drag-and-drop interface and allows you to edit each element of your landing page as you see it. Essentially, whatever you see on your landing page while editing it is what you will see when you publish it.

This allows you to create amazing landing pages on your own without having any knowledge of design or coding.

If you’ve been looking for a Shopify page builder app, you’ve probably come across PageFly. This Shopify app is available in over 150,000 stores and has received positive feedback. The majority of the reviewers mention the excellent free support provided by the team.

PageFly is one of the most popular landing page builders that focuses on ease of use. It enables you to create stunning landing and product pages without any coding. The best part is that it has a free plan.

It allows you to edit your page in real-time and see the final result before hitting the publish button. The sidebar on the left allows you to customize any element on the page.

It’s smooth and faster than coding by yourself when you are a programming noob. It works better than the other similar tools on the market in my opinion.

Let’s take a quick look at the pros and cons of this Landing Page Builder App below:


01. 24/7 Live chat support

PageFly has a great, easy-to-navigate knowledge base. Their support is responsive and helps to solve problems every time. There are many different tutorials, articles, and videos on it. It also has a superb “Best Practice” section where you can learn how to utilize the platform to its fullest potential.

If you require assistance, you can use the ticket system to submit your inquiry or, if you prefer, you can join the Facebook community and ask other users for help.

02. Build Several Pages On your Store

With PageFly, you can build various types of Shopify pages, such as home, collection, product and custom landing pages.

03. Customize Everything on The Page

The pages you create will be fully responsive and work on tablets, desktops, and mobile devices. Additionally, you can adjust each and every element with your complete control over the page.

04. Take Care of Your Sales Along with SEO
  • Make use of the inbuilt Pagefly Shopify app to take care of SEO
  • Create FOMO to increase and fasten conversions
  • Get testimonial and trust-building elements
  • Show your social media presence via Pagefly
05. Pricing

They do have a free plan, which is ideal for someone who wants to make just a few pages—like a landing page and a about me page, for example. It’s important to keep in mind that the free plan lacks many of the better page elements.


01. Refresh Page From Time To Time

When I have to refresh the editor page to see the actual content that will be published, for instance, I sometimes think the system is buggy. This means that what I see in the editor and what their server actually records are two different things. It occasionally happens, especially if you don’t do anything on your editor page. It took me a while to learn about this issue. I’m hoping they can enhance the performance or resolve this problem.

02 Third-Party Integration

Other Page Builder Apps like Shogun has built-in analytics and split testing, whereas with PageFly you have to integrate with third-party analytics.

Is the PageFly Shopify App Worth It?

A good Shopify page builder is like a color and your store is a canvas. To paint a canvas, you need great colors. 

No one is going to look at the empty or disorganized store, right? Why not use the PageFly Shopify app, which offers modern SEO features, to paint yours?

Therefore, the app is completely worthwhile, and using its free plan is not wrong. Switch your store page builder if you don’t like the platform. I’d strongly advise giving the platform a try.

You will, I’m sure, share my love for its elegant simplicity and striking designs.

7 High-converting Black Friday Landing Page Examples

Every marketing strategy requires a focal point, and nothing beats a dedicated landing page for your successful Black Friday campaign.

For the majority of your customers, your Black Friday landing page serves as the entry point to making a purchase. This is the page where you present your offer in the best possible light and convince visitors to click the buy button.

Keeping this in mind, here are some of our favorite Black Friday landing page examples. Use these as examples when deciding what to include in your own Black Friday landing page.

Here are some of the best Black Friday landing page examples I found that can help you gather a few inspiring ideas on how to promote your Shopify store. 

1. Tony Robbins

Tony Robbins celebrated the start of the Christmas holiday season with a powerful warm-hearted image on the hero section of his landing page for his holiday marketing campaign last year. He sent out inspiring and loving messages that prompted people to show their affection through the purchase of gifts, emphasizing emotion and the need to spend quality time with loved ones.

Tony used a quiz to help those who weren’t ready to buy figure out what they needed. Instead of leaving the site right away, site visitors had another reason to stay a little longer, increasing the chances of purchasing.

Unlike retailers, most online entrepreneurs do not invest heavily in Black Friday web design and relevant creatives. In this example, Tony simply greets site visitors and encourages them to click on the call-to-action button, which takes them to the products page.

The products page was extremely simple to use. You can see the various shopping categories on the left-hand side, such as productivity and performance, career and business, love and relationships, and many more.

The product description was in the center, and on the right, there were ‘Shop Now’ CTAs that took users directly to the checkout page.

2. Handle The Heat

Tessa Arias, a trained chef and cookie queen, runs Handle the Heat. She shows her audience various baking recipes and explains the science behind them. Here’s a screenshot of her Black Friday landing page, which features a discounted bundle of her baking books and classes:

Thanks to the prominent imagery and high color contrast in the headline copy, your attention is immediately drawn to the offer when you arrive on the page.

Tessa does an excellent job of emphasizing the value of her offer by stating how much I will save over the regular price. She also raises the stakes by stating that it is only available for a limited time and will not be repeated.

Tessa provides a rundown of all the features and benefits contained within the bundle as I scroll down the page. To ensure that visitors have every opportunity to make a purchase, each rundown is separated by a prominent call-to-action button.

3. Passion For Savings

Passion for Savings is a money-saving website that features printable coupons, online deals, and money-saving advice.

Passion for Savings offers coupons, online deals, and money-saving advice. The company chose a hero image that shows that the sales season has officially begun for this year’s Black Friday campaign. There is also a CTA button that takes them directly to the main page of interest, with the intention of leading people to check out the Black Friday deals.

Further down the page, the landing page section divider serves as an excellent CTA button that is difficult to overlook. It accomplishes this without interfering with the flow of the copy or impeding other important elements on the page.

This headline links to two other pages on the site: Best Black Friday Deals and Black Friday Alerts.

4. The Winery at Bull Run

The Winery at Bull Run, sells award-winning wines and provides artisanal wine-tasting experiences. The company offered an exclusive deal every hour for eight hours during their 2019 Black Friday campaign.

You can find the full landing page here.

The monochrome page design is simple and elegant, and it complements the overall “Black” Friday theme. Furthermore, by emphasizing that this is a “online only” offer, the page manages to increase the promotion’s exclusivity.

A prominent countdown timer serves as a compelling reminder to customers that they only have a limited time to take advantage of the company’s special offers.

Each special offer is explained in greater detail further down the page and is organized by the hour it is available.

5. Oh Hot GRAM

Oh Hot GRAM was a hairstylist and salon-designed course. It teaches other hairstylists how to use Instagram to grow their business. Despite the fact that this Black Friday landing page is longer than most, every piece of information is designed to overcome customer objections and persuade visitors to sign up.

Check out the full landing page here.

Jamie goes to great lengths to tee up her offer by highlighting three major pain points that she knows her target audience is experiencing. By emphasizing these problems early on, readers are left eager to learn more about the solution:

Positive reviews like these from real people are often what help convince fence-sitting leads to become new customers when it comes to social proof.

It explains in detail what each module of her course entails. This reassures potential customers by explaining exactly what they’re paying for.

6. Vimeo

Vimeo’s landing page was designed to promote the Cyber Monday holiday sale, which occurs immediately following the Black Friday weekend. In general, combining these two holidays in the same campaign is quite common. To spice things up, the company created their own version of the day, dubbed ‘Cyborg’ Monday, which is enticing enough to entice users to check it out.

The special offer is effectively communicated, as are the benefits and pricing information. The way Vimeo addresses its potential customers stands out in this example.

Speaking directly to the target audience and addressing them as ‘Vimean’ is a powerful brand-building strategy. It also appears to be an invitation to join their online community.

Vimeo offered a 25% discount on annual memberships and provided a promotional code for users to enter on the checkout page. The offer is only valid for ‘One day only,’ which is written in capital letters to convey urgency.

7. JoomlaShine

The biggest deal of the year is featured on JoomlaShine’s landing page template, and the company wants customers to know about it. What’s great about this example is that they tell their target audience that they don’t do this very often, reinforcing the idea that this is a huge opportunity to invest in.

The countdown timer is an effective component of the marketing campaign because it encourages site visitors to act quickly. If they are interested in the product, they must act quickly because the 50 percent Black Friday offer is only available for 72 hours.

The opportunity to subscribe to the email newsletter is also perfectly placed here, as it appears right next to the countdown timer and allows subscribers to act immediately.


Black Friday is just the beginning of a long season of grand winter sales. Prepare for the busy season by creating eye-catching web designs for your landing pages. Stop daydreaming about increased sales and start acting now!

To create an amazing landing page, pay attention to all of the essential elements that will feature your special course bundle or offer.

Here’s a checklist that I have prepared for an effective black Friday landing page.

5 Best SEO Tools for BFCM Campaign 2022

When the next BFCM has been coming closer, optimizing SEO Suite is one of the best ideas to increase your rank in search results. The different features themselves might bring an entirely different appearance and feel. 

Additionally, there are many apps that offer a variety of extra ways to customize your store to improve the user’s experience. They now are attempting to adopt more convenient features to optimize website images and structure to be more matched to the Google Search algorithm in order to enhance SEO performance and boost sales. 

There are several individuals around. The following is a list of the most useful features you really should be using now. Let’s jump right in!

1. Speed Up

High-quality images on your stores can be attractive to shoppers, but if not well optimized, they can slow down your website’s speed and lead to a higher bounce rate. 

Therefore, I decided to try Speed Up of AVADA SEO Suite. This is a new feature that makes the web pages fast on all devices which leads to a highly improved page speed performance score. Image Optimization is also my favorite feature of Speed Up.  After using it, all the images were automatically compressed to make it load faster and look more smoothly while keeping their quality unchanged.

Moreover, Speed Up has set up keyword-rich alt text for images, which enables Google Search to find the pictures easily so search engines can understand my store even though web browsers can’t properly render them. Speed Up serves as your assistant once again with Instant Page, Lazy Loading, and Minification.

2. SEO Analyst

For experts, SEO Analyst is a name that all of us are familiar with. Detailed analysis on the product pages with problem reports and improvement solutions are the top reasons to install it. Not only brings solutions for your main store, it also reveals some issues with our products, collections, blog posts, and pages. 

Besides, SEO Analyst shows well-presented details for me so as not to change mistakenly. Thus, the admin can easily follow the suggested improvements and make appropriate adjustments in time. 

3. 404 Pages

If your potential customers land on a 404 page on your website, they’ll immediately leave without seeing any content on your site. This will lead to a high bounce rate, affecting your website’s ranking.

So check your links frequently to spot all the 404 pages and redirect them to another specific page URL.

4. Google Search Console

Google Search Console is a free service offered by Google that helps monitor, maintain, and troubleshoot your site’s presence in Google Search results. 

From viewing Google Search traffic data for your site, you can know how often your site appears in Google Search, which search queries show your site, how often searchers click through for those queries, and more. 

Furthermore, this app is able to fix indexing problems and request re-indexing of new or updated content. 

Google offers a browser extension to know what pages are not indexed through the Index Coverage Report and test your mobile responsiveness with the Mobile Usability tool. It’s also easy to add your shop and get started, so there are no reasons to avoid it.

5. Search Appearance

Search Appearance should not be passed up if you’re seeking for something fresh. Search Appearance gives users authority to customize your store search appearance including meta tags, local business, Google Structured Data, and Instant Indexing. 

Google uses structured data to understand the content on the page. First, you need to provide specific information about your site, which can help your site display richer features in search results. 

Structured data can turn on to enable LD-JSON data and help Google display your site with interesting search appearance elements by adding breadcrumbs to home, product, collection, blog, article pages, and more.

Choosing The Best Tools For Your Business

These are the top SEO tools available today. You can receive insights from them that would otherwise take a long time to develop. Having stated that, you will need to put in the effort to achieve your goals. This entails creating SEO-optimized text, revising each product description, and making improvements based on what you’ve learned from these SEO tools. 

If you want to make sure you’ve covered all the bases, look over this SEO checklist. Most of these programs provide free features or trials you can experiment with if you’re on a tight budget. Give them a try and find out what has to be improved for you to rank higher in SERPs. Take the next step.

Top 5 Tools To Optimize Your Search Ranking You Really Should Be Using

Organic traffic can be said to be one of the needs that is very important to marketers, be it for sales or other purposes. In fact, not every marketer finds the most suitable apps to fit their needs because of some reasons. 

The statement “If you build it, they will come” is not true anymore. Therefore, software developers have created numerous SEO apps and plugins, helping you to optimize your website and making your work easier without the fear of losing traffic. 

Today, I will tell you the five best SEO tools that’ll help you improve visibility in SERPs. Let’s dive into the details!

1. Image Optimize: boost SEO with auto-optimization

As mentioned in the previous post, with Speed Up of AVADA SEO Suite, you can automatically optimize your shop’s image sizes and ALT tags, meta data, JSON-LD, and sitemaps. This feature-rich application claims to improve your Shopify store’s search engine results. 

Fortunately, SEO Suite helps to reduce your image size, and still keep its high quality for great shopping experiences. The best aspect of SEO Suite is that it is completely free. You may use all of its fantastic features for free and without getting charged. 

There are no setup fees or hidden charges. As a consequence, SEO Suite is among the finest Shopify SEO software.

2. Google Structured Data for eCommerce

In order to interpret the content on the page, Google employs structured data. You must first give particular information about your website so that it can show more information in search results. 

Google Structured Data
Image source: Google Search Central

By adding breadcrumbs to the home, product, collection, blog, article, and other pages, structured data can be enabled to enable LD-JSON data and assist Google in displaying your site with attractive search appearance features.

Google uses algorithms to interpret your content and its intent as it crawls and indexes other websites, including my e-commerce website. A defined machine-readable format for delivering details about a page is called structured data. This can increase the precision with which Google interprets your material.

3. Meta tags optimization

Meta tags are one of the most important parts of on-page SEO, which will be displayed on Google search results. Meta tags include meta title, meta description, and social meta. They will significantly decide whether customers might click on your website or not by giving a glimpse of insight to customers and why it’s relevant to their query.

To make sure Google performs logic and attractive meta tags for your website, you should write a unique title for different pages, which must be both brief and click-worthy. 

Besides, if you want to share a link from your website on your social channels, don’t forget to check the images attached to your shared links. These images may take a big part in increasing your page view.

4. Site Verification

As clear as its name, Site Verification is used to prove that you own the site or store. Before I knew about this feature, I was frequently being stolen the contents and images on the website. Thus, I did some research and found out that AVADA SEO Suite could help verify your store ownership with multiple apps like Google Search Console, Bing Webmaster Tools, Pinterest, and more. You only need to provide the whole meta name, then, this app will link you to the main website of those apps to get the verification code.

5. HTML Sitemap

Although there are many debates about the efficiency of the HTML sitemap, I still consider it a must-have tool that is very useful and valuable. HTML sitemap helps guide the visitors to where they want to go on my website. If they couldn’t find what they are looking for in the search, HTML sitemap is exactly where they will need to turn back. There are many additional excellent reasons to use a sitemap, in addition to assisting website visitors in navigating it. 

As you know, there are two main types of sitemaps: XML and HTML sitemap. XML sitemap will be more suitable for search engines and spiders because it gives them a URL website and brings data of a complete map of the web. Along with this, HTML sitemaps support all kinds of people and are often considered a well-organized table of content. However you look at it, an HTML sitemap is an easy way to get huge benefits without a lot of effort.

For instance, this is an HTML site map by Apple, which lists all the page structures of Apple

Make SEO Work Easier

SEO is critical, especially if you want more organic traffic rather than relying just on Facebook advertisements, which may be dangerous.

Selling good items isn’t enough to make you a successful Shopify shop. You must also verify that your business is SEO-friendly. Fortunately, thanks to these applications, it’s a lot easier than you may imagine.

If you’ve sorted out your store’s SEO, it’s time to focus on increasing the business. Check out my selection of the finest Shopify upsell applications above.

Cost Of Goods Sold: What It Is & How To Calculate It

If you’re selling online, you must closely track and monitor your Cost Of Goods Sold (COGS), one of the business’ crucial metrics that best reflect your store performance. But what is COGS and what makes it so important? 

In this article, I will give you a full view of What COGS is; Why you need to track it, and How to accurately calculate your COGS.

What is Cost of Goods Sold?

The Cost of Goods Sold (or COGS) is the total cost of manufacturing your business’ products or services, which contains all the costs for materials and labor as well. 

Since COGS is associated with production expenses only, it does not include marketing and distribution costs.

Here are some examples of costs that COGS generally includes:

  • Raw materials
  • Purchased items for resale
  • Purchase returns and allowances
  • Trade or cash discounts
  • Factory labor
  • Factory overhead
  • Parts for production 
  • Storage costs
  • Freight-in costs

Why do you need to track COGS for your business?

The Cost of Goods Sold shows your gross profit when deducted from its revenue. Therefore, it is considered a profitability measure to evaluate how efficiently you’re managing your business.

Since COGS directly affects your gross profit, you need to keep your COGS low to increase your net profit.

How to calculate Cost of Goods Sold?

Now that you know what COGS is and how important it is to your business, let me show you how to calculate it:

COGS = Beginning Inventory + Purchases – Ending Inventory

For those of you who are not yet familiar with the terms above:

  • Beginning inventory: This is the value of products and raw materials that are in stock at the beginning of the reporting period.
  • Ending inventory: It is the number of materials and products at the end of the reporting period.
  • Purchases: They include all of the components, raw materials, and sold to other parties during this period.

NOTE: Since COGS directly relates to your gross profit, and of course, net profit, it’s important that you keep track of your COGS frequently to spot abnormal ups and downs and make timely adjustments.

You can create your own Sheet files or download COGS templates on the Internet.

COGS template
Here’s a COGS Google Sheets template I found on the CFI’s website

However, you may have to spend hours gathering data and manually editing your files to keep your COGS accurate, which might be time-consuming. 

So, to keep track of your COGS, revenues, profits & losses fast and accurately, perhaps you may need a profit-tracking app like TrueProfit, which automatically updates your COGS in real time.

4 accounting methods for COGS

There are many methods to value your inventory, and different accounting methods for the Cost of Goods Sold yield different inventory values.

1. FIFO – First In, First Out method

To simply explain, the earliest products you make or purchase are the ones you sell first.

As prices tend to rise over time, you can use FIFO method to sell your least expensive products first, leading to a lower COGS than the one recorded under the LIFO method (which I’ll cover right after this). 

Therefore, your net income will increase over time if you adopt the FIFO method.

2. LIFO – Last In, First Out method

LIFO, on the opposite, refers to selling the last goods that were made or purchased.

As I mentioned, prices tend to rise over time, the latest products you made or purchased are the most expensive. So when you distribute these products first, it will result in a higher COGS and a lower net income in return.

3. The Average Cost method

This accounting method values inventory that uses an average cost for the period. Moreover, it blends the cost throughout the period and smooths out price fluctuations. 

4. The Specific Identification method

With this accounting method, you use the specific cost of each unit of the inventory or goods to calculate the inventory and Cost of Goods Sold for each period. So, you know exactly which item was sold and at what cost in this method.

Modern Industrial Factory Meeting: Confident Female Engineer Uses Interactive Whiteboard, Makes Report to a Group of Engineers, Managers Talks and Shows Statistics, Growth and Analysis Information

Additionally, you will find this Specific Identification Method used in industries that sell unique items such as cars, real estate, and jewelry.

Compare the Cost of Goods Sold to other metrics

Many of you may think that Cost of Revenue and Operating Expenses are just other names of COGS. But actually, they are not.

1. COGS vs Cost of Revenue 

First of all, the Cost of Revenue relates to the total cost of manufacturing and delivering a product or service to your consumers. It includes raw materials, direct labor, commission paid to your employees, and shipping costs. 

However, the Cost of Revenue is different from COGS because it also includes the cost outside your production like marketing and distribution.

It should be noted that if you make a profit out of providing 100% services, you have to list your costs as Cost of Revenue, instead of COGS. 

services that cannot include COGS
For instance, painters, doctors, lawyers, and carpenters are not included in COGS


Still, if you’re a service-based business but you have products to sell, you can consider COGS in your income statements. For example, hotels and airlines primarily provide services such as lodging and transportation. They also sell food, beverage, gifts, and many other items. These are undoubtedly considered goods.

So be confident to list COGS on their income statement and claim tax purposes if you fall into one of the categories above.

2. COGS vs Operating Expenses

Though Operating Expenses and Cost of Goods Sold are similar because they’re both costs arising when you’re running your business, they’re different metrics on the income statement.

Unlike the Cost of Goods Sold, Operating Expenses are expenditures that don’t link directly to your goods or services production costs.

Selling, general, and administrative expenses (or SG&A) belong to operating expenses as a separate line item. Moreover, there are also other examples, including:

  • Legal costs
  • Office supplies
  • Rent
  • Utilities
  • Payroll
  • Sales and marketing
  • Insurance costs

Final thoughts

And that’s it! Cost of Goods Sold is undoubtedly one of the most important metrics that you need to track since it directly affects your gross profit and tells you whether it’s possible for you to make a profit or not.