New Customer CM2: First-Order Variable Margin

New Customer CM2 measures the variable margin from first-time buyers—CM1 minus fulfillment and transaction costs for new customer orders.

Formula

NC CM2 = NC CM1 − NC Fulfillment Costs − NC Transaction Costs

Formula Components

Metric	Definition
NC CM1	New customer gross margin
NC Shipping Cost	Shipping costs for new customer orders
NC Handling Cost	Handling costs for new customer orders
NC Gateway Cost	Payment processing fees for new customers
customer_type = new_customer	Filters to first-time buyers

Metadata
Type	Currency
Data Source	Shopify, Upstack Costs
Aggregation	Sum

Example

New customers generated $32,000 CM1 with $4,000 fulfillment and $2,000 transaction costs.

Component	Amount	Calculation
NC CM1	$32,000	After COGS
NC Fulfillment	$4,000	Shipping + handling
NC Transaction	$2,000	Gateway fees
NC CM2	$26,000	$32,000 − $6,000

How It Works

NC CM2 shows the contribution margin from new customers after all variable per-order costs. This is the margin available to cover acquisition costs and contribute to profit. If NC CM2 is lower than CAC, you’re losing money on customer acquisition.

When to Use

Scenario	Action
Setting CAC limits	NC CM2 should exceed CAC for profitable acquisition
Comparing customer economics	Benchmark NC CM2 vs RC CM2
Evaluating fulfillment options	See how shipping choices impact new customer margin
First-order profitability	Determine if first orders are profitable before marketing

Metric	Relationship
NC CM2 %	NC CM2 as a percentage of NC net revenue
RC CM2	Variable margin from returning customers
CAC	Cost to acquire new customers

See all Contribution Margin metrics →

⌘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