Dropshipping Gadgets Ecommerce Metrics Glossary: The Terms That Matter

Choose the Metric That Matches the Decision

Choose the metric based on the decision, not because it is the largest number on the dashboard. Revenue answers, “How much did we sell?” Use it to assess demand, order volume and collection performance. For a Singapore store, realized revenue should reflect delivered orders; returned and cancelled orders should not inflate the figure. Keep calculations in the store’s trading currency rather than mixing currencies.

Profitability answers, “What remains after product and operating costs?” Use gross profit and margin to assess product economics, and contribution after advertising to decide whether a product or collection merits more, less or different acquisition spend. Net profit is the broader business check because it includes the remaining costs in the model.

Customer metrics answer, “Who bought, returned and bought again?” Use them when judging repeat behaviour or customer-level profitability; a high-revenue product can still attract one-time buyers or costly returns. Read the measures together, then act on the one that matches the decision.

• Worked example: 100 delivered orders at S$40 produce S$4,000 realized revenue. With S$1,600 product cost, gross profit is S$2,400 and gross margin is 60%. After S$900 advertising, contribution after advertising is S$1,500, or 37.5%. If 80 customers generated those 100 orders, 20 were repeat orders, giving a 20% repeat-order share. None of these figures alone proves the store is healthy.

Revenue Terms That Show What You Sold

Gross sales is the listed value of products sold before discounts, refunds or returns; keep shipping separate unless your store defines it as merchandise revenue. Formula: item price × units. Example: 10 gadgets at S$40 = S$400 gross sales. Use it to assess demand before commercial adjustments, not cash actually retained.

Net sales removes discounts and refunds from gross sales. Formula: gross sales − discounts − refunds. Example: S$400 − S$30 discount − S$40 refund = S$330 net sales. Report shipping charges separately so a S$10 delivery fee is not mistaken for product demand. Cancelled orders should not count as realized revenue; ORVX calculates realized revenue from delivered orders only and excludes returned or cancelled orders.

Order volume is the number of qualifying orders in the period. Formula: count of paid, non-cancelled orders. Example: 80 completed orders = 80 orders. Use it to judge transaction demand and to interpret average order value. Average order value (AOV) is net sales divided by order volume: S$330 ÷ 8 orders = S$41.25. Use AOV when assessing bundles, upsells or changes in basket size.

Keep currencies separate: convert foreign transactions using a stated rate and date rather than adding amounts in different currencies. Singapore stores should also distinguish sales from GST: the current GST rate is 9% (Inland Revenue Authority of Singapore), so state whether figures are GST-inclusive or exclusive. ORVX keeps each merchant’s trading currency and never mixes currencies in one figure (Source: Inland Revenue Authority of Singapore).

Margin Terms That Show What You Keep

Gross profit is revenue minus product cost and supplier shipping. If a gadget sells for S$40, costs S$15 from the supplier and S$5 to ship, gross profit is S$20. Gross margin is gross profit divided by revenue: S$20 ÷ S$40 = 50%. Use these measures to judge sourcing, pricing and product-level economics before advertising.

Contribution margin subtracts the variable costs required to generate and fulfil each sale, including product cost, supplier shipping, payment fees, ad spend and other per-order costs. A S$20 gross profit sale with S$1.20 in payment fees and S$8 ad spend contributes S$10.80, or 27%. Customer acquisition cost (CAC) is ad spend divided by new customers acquired; S$800 ÷ 100 customers = S$8 CAC. Compare CAC with contribution per first order, not revenue. ORVX can report contribution after advertising by product and collection, alongside profitability.

These measures answer different decisions. Gross margin compares product economics before acquisition, while contribution margin tests whether the order still leaves money after the costs used to win it. A product can have a healthy gross margin but a negative contribution margin when advertising or payment costs are high. Conversely, a lower-margin product may contribute more dollars per order, so use both the percentage and the S$ amount when deciding whether to scale traffic. Contribution is not net profit: it does not by itself account for fixed overheads such as software, salaries or rent. Check refunds and cancellations before treating projected contribution as money kept.

Customer Terms Beyond the First Order

Conversion rate = orders ÷ sessions × 100. If 80 orders come from 4,000 sessions, conversion rate is 2%. Act on it when traffic is reaching the store but not becoming orders: check product pages, delivery promises, payment options and mobile checkout. It is most useful for frequently replaced gadgets, where customers may buy again soon; it does not measure whether those orders are profitable.

Repeat purchase rate = customers with at least two orders ÷ total customers × 100. If 120 of 1,000 customers reorder, the rate is 12%. Use it against the product’s replacement cycle: accessories or consumables can be assessed monthly or quarterly, while a durable gadget may need a 6-12 month cohort window. Customer lifetime value (CLV) estimates customer revenue: average order value × purchases per year × expected years. An S$50 average order, 1.5 purchases yearly and a two-year life gives S$150 CLV; use a profit-based version when deciding acquisition spend. Refund rate = refunded value ÷ sales value × 100. S$300 refunded against S$10,000 sold equals 3%. Act on it by product and cohort when quality, fit or delivery issues appear, rather than treating every refund as a conversion problem.

Costs That Can Distort a Singapore Store’s View

Several costs can make the same order look different across dashboards. Keep customer-paid delivery separate from supplier shipping: a S$40 gadget with S$5 supplier shipping has a different product margin if that S$5 is omitted or recorded later. If the supplier changes from S$15 to S$18, update the product-cost model by SKU and order period rather than applying today’s cost to older orders. Payment processing is also an expense, not a reduction in listed sales. Singapore’s current GST rate is 9%; keep tax treatment distinct from operating margin (Source: Inland Revenue Authority of Singapore).

Discounts reduce what the customer paid, while refunds and returns reduce realized revenue. A S$40 order discounted to S$36 and then refunded should not remain in the same revenue view as a delivered S$36 order. Track refund value against revenue, and keep chargeback costs visible rather than hiding them in payment fees. Currency conversion can distort every ratio when supplier, advertising and store figures use different currencies; convert consistently and never mix currencies in one figure. Use gross sales to inspect demand, realized revenue to assess delivered orders, and contribution after advertising to decide whether a product or collection is worth scaling.