What does each line of the P&L mean?

Your P&L has 34 lines, and you read it from top to bottom. Each line brings your sales one step closer to profit. Here is every line in one simple sentence, in the order the P&L shows them. Seven lines open with an arrow to show what is inside them. GMV and the subtotals can also fold the lines under them.

Gross Merchandise Value (GMV) is everything you sold at full price, the compare-at price if you set one, with VAT and without shipping. Price Reductions is what you gave away by selling below the compare-at price. Price Reductions % of GMV is Price Reductions as a share of GMV. Discount Codes is what discount codes and automatic discounts took off your products. Discount Codes % of GMV is Discount Codes as a share of GMV. Shipping Revenue is what customers paid you for shipping, with VAT, after shipping discounts. Gross Revenue is GMV minus Price Reductions and Discount Codes, plus Shipping Revenue.

Gross Orders counts the orders placed, without cancelled and test orders. Gross AOV, the gross average order value, is Gross Revenue divided by Gross Orders. Returns is the value of what refunds took back, products and shipping, with VAT, on the day of each refund. Return Value % of Gross Revenue is Returns as a share of Gross Revenue. Taxes is the VAT inside what you kept: the tax on your orders minus the tax you refunded. Tax % is Taxes as a share of Gross Revenue minus Returns. Net Revenue is Gross Revenue minus Returns and Taxes: the first number that is really yours. Net Orders is Gross Orders minus the orders that were refunded in full. Net AOV, the net average order value, is Net Revenue divided by Net Orders.

COGS, the cost of goods sold, is what the products you sold cost you, minus the cost of refunded units. COGS % is COGS as a share of Net Revenue. CM1 is Net Revenue minus COGS: what your products earn. CM1 % is CM1 as a share of Net Revenue. Logistic Costs is shipping labels, pick and pack, packaging, packaging recycling fees (EPR) and return handling, added together. Logistic Costs % is Logistic Costs as a share of Net Revenue. Transaction Costs is the fees your payment providers take from each payment. Transaction Costs % is Transaction Costs as a share of Net Revenue. CM2 is CM1 minus Logistic Costs and Transaction Costs: what each order earns. CM2 % is CM2 as a share of Net Revenue.

Marketing Costs is your ad spend from Meta, Google and TikTok, plus the marketing spend you add yourself. Marketing Costs % is Marketing Costs as a share of Net Revenue. CM3 is CM2 minus Marketing Costs: what is left to pay for the rest of the business. CM3 % is CM3 as a share of Net Revenue. Overhead Costs is your running costs, like rent and salaries, spread over the days, plus one-off costs on their date. Overhead % is Overhead Costs as a share of Net Revenue. EBITDA is CM3 minus Overhead Costs: your profit after every cost. EBITDA % is EBITDA as a share of Net Revenue. A percentage shows a dash when there is nothing to divide by, like a margin on a day with no sales. Why most percentages use Net Revenue has its own answer.