Custom Costs is a feature for you to add extra expenses to TrueProfit manually. As a seller on Shopify, there might be many different kinds of costs that incur in your store, for example taxes paid, Shopify subscription, KOL/influencers, or even Ad agencies costs. Basically, any costs that don’t fall into other existing categories in TrueProfit can be created and customized in the Custom Costs feature.
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What are fixed costs and variable costs?
Fixed cost:
A cost with a set amount that does not change, no matter how many orders you get.One-time or recurring.
Example: Shopify subscription = $39/month, office rent = $500/month, or a one-time design fee = $200.
2. Variable cost:
A cost that is calculated as a percentage or formula, depending on your store’s performance.
Changes based on revenue or order value.
Example: An ad agency charges 10% of your monthly Facebook Ad spend, or a KOL takes 5% of revenue from sales with their code.
How to add a fixed cost
Step 1: Go to Custom Costs in the left menu > click Add cost.
Step 2: Enter a name, then select Fixed cost.
Step 3: Choose the currency and enter the amount.
Step 4: Repeat this cost
Decide if this cost is one-time or recurring.
For one-time costs: Leave the repeat option off.
For recurring cost: Turn on Repeat this cost and set the frequency (repeat every 1 day, every week, every month).
Step 5: Set the dates.
One-time cost: Start date = End date.
Recurring cost or ongoing cost: Select only the Start date. End date is no needed. Click the x to remove end date
Step 6: Select or add a category by typing
There are 2 common categories: Marketing and Taxes Paid
Step 7: LTV:CAC ratio (optional)
Check the box “Include in LTV:CAC ratio”, If you want this cost to be included in the LTV:CAC ratio calculation.
Leave it unchecked if you don’t want this cost counted in the ratio.
Step 8: Click Add
How to add a variable cost
Step 1: Go to Custom Costs > click Add cost.
Step 2: Enter a name, then select Variable cost.
Step 3: Select cost source
Choose the source of this cost (e.g. % Facebook, % Google Ads, %COGS).
Enter the percentage you want to deduct.
Example: If you hire an agency to run Facebook Ads and they charge 10% of your Facebook Ad spend, select % Facebook and enter 10.
Step 4: Set the dates
One-time cost: Start date = End date.
Recurring cost or ongoing cost: Select only the Start date. End date is no needed. Click the x to remove end date
Step 5: Select or create a category by typing
There are 2 common categories: Marketing and Taxes Paid
Step 6: LTV:CAC ratio (optional)
Check the box “Include in LTV:CAC ratio”, If you want this cost to be included in the LTV:CAC ratio calculation.
Leave it unchecked if you don’t want this cost counted in the ratio.
Step 7: Click Add
Managing custom cost categories
Custom Cost Categories help you manage your custom costs easier. A Custom Cost report based on categories is also available in the Categories tab.
Step 1: On the Custom Costs page, click Manage categories.
Step 2: Review the 5 default categories:
Agency fees
Office expenses
Labor cost
Marketing
Taxes Paid
Step 3: To create a new category, type the name in the search bar > click Add.
Hope this article helps you set up Custom Costs with ease. If you have any questions, feel free to reach out to our support team.