What is Gross Margin in D2C?

Gross Margin in D2C is the percentage of revenue remaining after subtracting the Cost of Goods Sold (COGS). It represents the profit available to cover operating expenses, marketing, and net profit.

How do you calculate Gross Margin?

Gross Margin (%) = ((Total Revenue - COGS) / Total Revenue) × 100. In D2C, we often look at "Contribution Margin" which also subtracts shipping and marketing costs.

What is a healthy gross margin for an ecommerce brand?

A healthy gross margin for D2C brands is typically 60% or higher. This allows for roughly 20-30% marketing spend while still leaving room for operational costs and profit.

Why is tracking gross margin critical?

Without accurate margin tracking, D2C brands often scale into losses. Knowing your margin helps you determine how much you can afford to spend on customer acquisition (CAC).

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Gross Margin Analyzer

Financial

Complete margin analysis with cost waterfall, SKU insights, and optimization scenarios

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Industry

Monthly Revenue

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Monthly Orders

Product COGS

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Manufacturing Overhead

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Packaging Cost

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Shipping Cost

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Warehousing Cost

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Payment Processing %

Marketplace Commission %

Return Rate

Return Processing Cost

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RTO Rate

RTO Cost per Order

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Avg Discount %

% Orders Discounted

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Industry

Monthly Revenue

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Monthly Orders

Product COGS

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Manufacturing Overhead

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