Profit & Loss

Objective

The Profit and Loss (P&L) dashboard is a financial summary of the revenues and expenses incurred during a specific period of time. This report brings together all expense items and profile assumptions input into Lime Light and associates them to the relevant revenues.  Additionally, it generates several key management metrics regarding financial performance.

Monitor, analyze and act on revenue, expense, and profit numbers specific to any of the dashboard filters such as campaign, vertical, channel, country, gateway, BIN, etc. 


Potential Actions

  1. Identify components of marketing efforts that can be optimized to increase profitability.

  • Data presented in this dashboard is based on "Acquisition Date" unless otherwise noted. Acquisition Date is the date that the original order was placed and allows Analytics to present data in an appropriately connected way.  Specifically, Acquisition Date associates Re-bill and Recurring transactions (Cycles 1…X) to the Initial transaction that initiated the order.  When calculating many metrics, disassociating the recurring transaction types from the date of origination (the Initial transaction) causes arithmetic inconsistencies and brings incorrect and misleading results - and ultimately incorrect business decisions.

    As an example: metrics that incorporate time-phasing and transaction type correlation into the calculation: think Re-Bill rate or Chargeback Rate; they both associate a transaction event to other components of the overall order within a timeframe.

    That being said, there are instances where you may want to simply see the count, or value, or count by transaction type, of transactions within a period.  When this type of analysis is performed it will be noted as such.

  • All orders marked "test" within the platform are automatically removed from the Analytics data.
  • Please reference the Lime Light Order Cycle Nomenclature visual below to understand the way that Lime Light references the phases of a each order type. 

 


Video Length: 17:42

 

 

Chart / Table

Description

Formula

Net Profit & Total Expenses

The chart trends Net Profit (the line portion of the chart), Total Expenses and Gross Revenue (column portions of the chart) within the date range set.

Data Based OnAcquisition Date - Data is organized by the date that the original order was placed. This allows Analytics to present data in an appropriately connected way. Specifically, Acquisition Date associates Re-bill and Recurring transactions (Cycles 1…X) to the Initial transaction that initiated the order.

Total Expenses = Sum(Expenses)

Gross Revenue = Sum(Gross Revenue)

Net Profit = (Gross Revenue - Total Expenses - Tax)

Expenses by Category

The stacked bar chart trends expenses broken out by category (i.e. Fulfillment, Customer Service, Merchant Processing, etc) for the given date range.

Data Based On: Acquisition Date - See description above.

 

Profitability

This table includes the key indicators to understanding profit such as Gross Revenue, Net Revenue, Total Expenses, Net Profit, COGS, Gross Profit, Reserves and Profit per Customer.

Data Based On: Acquisition Date - See description above.

 

Gross Revenue   

Gross Revenue is the total revenue generated by sales - no refunds, discounts, or expenses are deducted from Gross revenue. Gross Revenue is sometimes referred to as Gross Sales.

Sum(Order Total Revenue)

Net Revenue   

Net Revenue takes into consideration simple deductions to Gross Revenue - specifically, any refunds or Chargebacks.

Net Revenue does not deduct any other Expenses Types (e.g. Affiliate Costs, Operating costs, etc.) or Taxes.

(Gross Revenue - Refunds - Chargebacks)

Total Expenses   

Current billing cycle total expenses - The summation of all Expense -- expense assumptions, COGS and Merchant Processing.

To add/modify expenses, refer to the Overview of Expenses page.

Sum(Expenses)

Net Profit   

Net Profit is the Net Revenue (Gross Revenue minus Refunds and Chargebacks) minus all expense items including Taxes. This is the bottom line amount of money made.

Gross Revenue - (Total Expenses + Taxes)

Refunded   

Total amount refunded.

Sum(Refunds)

Refunded w/o MCB   

Amount of refunds that are not related to chargebacks.

Sum(Refunds + Refunds from MCBs)

COGs   

The total cost of producing a product up to the point of sale. This would include costs such as manufacturing, packaging, pre-sale shipping or import duties, etc.

Sum(COGS)

Gross Profit   

Gross Profit is the revenue generated minus the cost of the product sold before the deduction of any other expense assumptions.  It is important to note that Gross Profit is derived from Gross Revenue so it does not deduct Refunds from the starting revenue point.

Gross Revenue - COGS

Reserves   

Gateway estimated reserves based on the value set in the Lime Light platform configuration. Reserves is a set amount of the Advertiser’s money that is put aside by the acquiring bank as a security deposit. This safeguards the financial institution from unplanned liability.

Approved Revenue × Reserve %

 By billing cycle

Refer to Edit Gateway in the Configuration section to determine how you set the Reserve percentage

Profit per Customer   

The average amount of profit generated from an individual customer.

Net Profit ÷ Unique Initial Customers

Refunded by Cycle

This table provides the 5 key metrics surrounding refunds and presents the data by cycle.

Data Based On: Acquisition Date - See description above.

 

Refund #

 Refund count. Count(Refunds by BIN) 

Refunded   

Gross Revenue lost as a result of refunds.

  • Based on Refund Date, not on the transaction date of the refunded transaction.

Sum(Refunds)

Refunded Rev %

 Percentage of Gross Revenue lost due to refunds.  (Amount Refunded ÷ Total Revenue)

Refunded w/o MCB   

Refunded amount from refunds that were not chargebacks. This is based on the Refund Date, not on the transaction data of the refunded transaction.

Sum(Refunded) - Sum(MCB Refunded)

MCB Lost Rev.   

MCB Lost Revenue is Gross Revenue lost within the designated time period as a result of chargebacks only.

Note: The benefits of representment is not reflected in the MCB Lost Revenue calculation.

 Sum(Gross Revenue of Transactions Charged back)

Orders

This table includes all of the relevant information related to orders such as Gross Revenue, Order Count, Unique Customers, MCB Count, Average Order Value, etc.

Data Based On: Acquisition Date - See description above.

 

Gross Revenue   

A summation of all Revenue within a current billing cycle.

See formula above.

Net Revenue   

See description above.

Gross Revenue - Refunds - MCBs [if a Refund wasn't posted for MCB]

Orders   

The total number of approved orders within the date range.  Sum(Approved Transactions)

Unique Customers   

The total number of unique new customers. Lime Light identifies unique customers through email address.  Sum(Unique Customers)

# MCB   

The total number of Chargebacks within the date range. This is based on Chargeback date, not the date of the date of the transaction

 Count(MCBs)

AOV   

Average Order Value (AOV) tracks the average amount spent each time a customer places an order. AOV is a key metric that marketers measure to understand their customers’ purchasing habits.

Gross Revenue ÷ Gross Orders

Retention Initial   

The percentage of consumers that successfully billed from the Initial cycle. Current Cycle Orders ÷ Initial Cycle Orders

Retention Previous   

The percentage of consumers that successfully billed from the previous cycle. Current Cycle Orders ÷ Previous Cycle Orders

Expenses

The data in the Expenses table is derived from the Expense Assumptions made. For more information about Expense Assumptions, please refer to the Help Center (Overview of Expenses).

Data Based On: Acquisition Date - See description above.

 

Operating   

General business expenses. Put all of the expenses here that need to be accounted for in any P&L such as rent, utilities, salaries, etc. Using the Operating expense assumption helps to get the P&L closer to reality.

To modify this data element, refer to the Overview of Expenses page.

 Sum(Cycle Operating Expense)

Packaging   

Expenses associated with the packaging material (boxes, bubble wrap, tape, etc) used to ship orders to customers.

To modify this data element, refer to the Overview of Expenses page.

Sum(Cycle Packaging Expense) 

Postage   

Expenses associated to postage fee for shipping orders to customers.

To modify this data element, refer to the Overview of Expenses page.

Sum(Cycle Postage Expense) 

Fulfillment   

Expenses associated with pick and pack activities. It's best practice to separate packaging, postage, and fulfillment so each expense is isolated and can be trended over time to determine if one of these three expenses is out of line.

To modify this data element, refer to the Overview of Expenses page.

 Sum(Cycle Fulfillment Expense)

COGs   

Expenses associated with the manufacturing and production of goods.

To modify this data element, go respective product and edit the product's “Cost of Goods Sold."

 Sum(COGS Expense)

Customer Service   

Expenses associated with handling inbound customer service inquiries.

To modify this data element, refer to the Overview of Expenses page.

 Sum(Customer Service Expense)

System   

Expenses associated with all systems used to manage the online business. This includes the expense for Lime Light, hosting, and any other technology-related expense that needs to be accounted for in the P&L.

To modify this data element, refer to the Overview of Expenses page.

 Sum(System Expense)

CPA   

CPA stands for Cost per Acquisition and is an advertising pricing model based on paying for direct results. The direct correlation between the action taken and the payment for the advertising that led to the action.  Sum(Cycle CPA)

Total Expenses   

The sum of all expenses. To add/modify expenses, refer to the Overview of Expenses page.

Sum(Cycle Expenses)

Merchant Processing Expenses

The data in the Merchant Processing Expenses table is derived from each respective processor profile. 

Data Based On: Acquisition Date - See description above.

 

Merchant Processing - Fixed   

Expenses associated with transaction fee charges for processing of credit cards.

To modify this data element, go to the respective Gateway Profile and edit the “Transaction Fee.”

See the Merchant Processing Flow Model diagram below for additional background on merchant processing.

Sum(Orders Transaction Fee)

Merchant Processing - Variable   

Expenses associated with processing credit cards. To modify this data element, go to the respective Gateway Profile and edit the “Processing Percent.” 

See the Merchant Processing Flow Model diagram below for additional background on merchant processing.

Sum(Orders Processing Percent)

Merchant Processing - MCB   

Expenses associated with chargeback fees paid for each chargeback received. The Chargeback fee is counted as an expense when the order is flagged chargeback.

To modify this data element, go to the respective Gateway Profile and edit the “Chargeback Fee." 

See the Merchant Processing Flow Model diagram below for additional background on merchant processing.

Sum(Chargeback Fee)

 

 

 

 

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