The sales notification is the easy part. Working out how much of that sale belongs to you takes a little longer.
It’s the end of a busy month. Orders are up, but the bank balance barely covers the next supplier invoice. Before you blame the sales team or cut spending, follow the costs. Revenue tells you how much you sold. It leaves out what you spent to make those sales.
Profit and cash are different checks. Stock bought for next month uses cash now, while goods already sold belong in this month's cost of sales. A delayed marketplace payout can also leave a profitable business short of spendable cash. Keep a cash plan alongside the profit report.
Follow one RM100 sale
Start small. Suppose a direct-to-consumer brand records RM100 in net sales, after discounts and refunds and excluding sales tax collected for the authorities. Cost of goods sold (COGS) is RM30. Another RM25 goes to transaction fees, fulfilment and advertising attributable to the sale. That leaves RM45 of contribution before shared expenses. The RM70 gross profit after COGS is not net profit.
Use the cost of the units sold, not the whole supplier payment. For an own-product brand, the supplier's RM20 quotation may not be the complete inventory cost. Production and costs of bringing the goods to their location and condition can matter too. Ask your accountant which costs belong in COGS and which are selling expenses, then avoid counting them twice.
Look at the full period before calling that contribution profit. At RM100,000 in monthly net sales, this example has RM30,000 COGS and RM25,000 selling costs, leaving RM45,000 contribution. Suppose salaries, rent and all other expenses, including financing costs and income tax, total RM30,000. The remaining RM15,000 is a simplified net profit of 15%. Allocated per RM100 of sales, those other expenses are RM30; they are not necessarily a fixed charge on every order. These figures illustrate an own-product DTC business, not a benchmark for all SMEs or retailers.
A discount reaches the bottom faster
Now take RM10 off the selling price. If the RM30 COGS stays the same and selling costs remain RM25 in this simplified example, contribution falls from RM45 to RM35. Revenue dropped by 10%, but contribution dropped by about 22%. Some fees will change with the selling price in real life; calculate those rather than assuming every cost is fixed.
This is why “we will make it up in volume” needs a calculation. At RM35 contribution per order, you need about 29% more orders to replace the contribution from the same number of RM45-contribution orders. Shared expenses still need covering. You also need enough stock, packing capacity and cash to fulfil those additional orders. More orders are not free.
Do not confuse the payout with the sale
Check the marketplace settlement statement before entering a payout as sales. It may already have fees deducted. Deduct them again and you understate what remains. Start with gross sales and leave out refunds or fees, and you overstate it. Keep the statement nearby while you reconcile the totals.
For a Malaysian seller using Shopee, Lazada or TikTok Shop, work from the actual order and settlement exports. Separate seller-funded vouchers, platform-funded subsidies, affiliate commissions and shipping adjustments. Do not assume a payment into your bank account covers the same dates as the sales report. Platform fee schedules and programmes change; this article deliberately does not prescribe a fee rate.
Pick a consistent starting point. For a simple operating view, record sales after discounts and refunds, record product costs, and record selling costs separately. Check whether shipping charged to customers and taxes are included. Keep the definition next to the number so next month's comparison uses the same basis.
Look at three numbers together
Read revenue, contribution in ringgit and contribution as a percentage side by side. Revenue tells you about scale. Ringgit contribution tells you what is available to cover shared expenses. The percentage tells you how much of each sales ringgit remains at that stage.
If sales rose but contribution fell, look for the biggest change in the breakdown. A promotion might have shifted orders towards cheaper products. Higher advertising costs might have used up the extra revenue. Check for duplicated costs too. Once you know what changed, you can decide whether to adjust the offer, the spend or the report.
Sources: Shopify profit reports · IAS 2 inventory principles. Checked 10 October 2026. Shopify’s gross-profit definition differs from contribution here; confirm the accounting framework and tax treatment applicable to your business.