COGS Net Rate: Product Cost as % of Net Revenue

COGS as a percentage of net revenue—higher than gross rate because discounts and refunds reduce the denominator.

Formula

COGS Net Rate = ( COGS ÷ Net Revenue ) × 100

Formula Components

Metric	Definition
COGS	Total cost of products sold
Net Revenue	Revenue after discounts and refunds

Metadata
Type	Percentage
Data Source	Shopify, Upstack Costs
Aggregation	Ratio

Example

Your store generated $125,000 in net revenue with $47,500 in product costs this month:

Metric	Value
Net Revenue	$125,000
COGS	$47,500
COGS Net Rate	38.0%

This means 38% of your retained revenue goes toward product costs, leaving 62% gross margin on net revenue.

How It Works

Divides total COGS by net revenue (after discounts and refunds), then multiplies by 100. This rate is higher than the gross rate because discounts and refunds reduce the denominator. A lower percentage indicates better margin retention after adjustments.

When to Use

Scenario	Action
True profitability	Use after-adjustment baseline for margin analysis
Discount impact	Compare to gross rate to see how discounts affect cost ratios
Margin benchmarking	Track trends to ensure costs don’t outpace net revenue
Segment comparison	Compare against NC and RC rates for customer-type insights

Metric	Relationship
COGS	Dollar value used in numerator
Net Revenue	Revenue baseline in denominator
New Customer COGS Net Rate	First-time buyer segment
Returning Customer COGS Net Rate	Repeat buyer segment

See all COGS metrics →

RC COGS/Gross %NC COGS/Net %

⌘I

​Formula

​Formula Components

​Example

​How It Works

​When to Use

​Related Metrics

Formula

Formula Components

Example

How It Works

When to Use

Related Metrics