% Variable Custom Expenses excl. Ad Spend
What it costs to fulfil and sell a euro of goods, before any marketing.
What it means
% Variable Custom Expenses excl. Ad Spend is the share of Total Sales taken by your variable Cost Settings entries that are not marked as Ad Spend — sales commission, per-order pick-and-pack, marketplace percentages, anything charged as a rate to run the shop rather than to sell it. Each entry is set as a percentage of Total Sales, a percentage of ad spend, or an amount per order.
It's one of the two halves of % Variable Custom Expenses% Variable Custom ExpensesSee the full entry.. Every variable entry lands in exactly one of them, and because both divide by Total Sales, this column and % Variable Custom Expenses Ad Spend% Variable Custom Expenses Ad SpendSee the full entry. add up to it exactly.
Show the math
Formula and a worked example
Variable Custom Expenses excl. Ad Spend is every variable entry not marked as Ad Spend, resolved at its own rate for the period and prorated by the days it covers.
Total Sales is everything you took in, tax and delivery charges included.
Worked example. March: €120,000 of Total Sales and 1,500 orders. A 6% sales commission charges €7,200. A €2 pick-and-pack fee charges €3,000. Neither is marked as Ad Spend, so this column reads 10,200 ÷ 120,000 = 8.5%.
The agency's 10% on €30,000 of ad spend is marked, so its €3,000 sits in the other column at 2.5%. Add them: 8.5% + 2.5% = 11%, which is what % Variable Custom Expenses reads. The two halves always meet there.
Now hold the sales and drop average order size, so the same €120,000 arrives across 2,000 orders. Commission is unchanged at €7,200, but pick-and-pack becomes €4,000 and the column reads 9.3%. Same revenue, same rates, more expensive — because one of them is charged per order.
It answers the question
What does a euro of sales cost you to fulfil and to sell, before a cent goes to marketing? It's the operating half of your variable cost base, and it applies to every euro you will ever take.
Why it matters
This is the closest thing on the page to a true cost of doing business. It sets a floor: whatever happens to ad budgets, every euro of sales still carries this, and doubling the business doubles the cost. Scale doesn't dilute a rate.
It's also where per-order fees and small baskets collide. A €2 pick-and-pack costs the same on a €40 order as on a €90 one, so this column moves when AOVAOVYour average order size, and a direct lever on revenue. does without any rate being renegotiated. That's the most common reason it drifts.
And none of it is in Gross MarginGross MarginProfit after product cost; the ceiling on what you can spend to grow.60% or more is healthy, which takes only COGSCOGSKeep it synced from Shopify, or every profit number is guesswork. off Total Sales. A shop can look comfortable two rows up and thin at the bottom purely because of what sits here.
What good looks like
There are no published bands. The level is the sum of the rates you agreed, so the honest target is the one in your contracts — judge the column against them rather than against another shop.
Two comparisons do the work. Against your sales-based rates: if your commissions add up to 6% and this reads 9%, the extra is per-order fees, and order size now matters as much as the rates do. And against itself month to month: this should barely move. A step change is a new entry, a renegotiated rate, or an order mix that shifted underneath fees that never noticed.
How to improve it
| Lever | What you do | Expect | How long | Watch out for |
|---|---|---|---|---|
| Fast Re-cut the rates | Renegotiate commission, marketplace and per-order fulfilment rates, starting with the largest entry | A sales-based rate cut moves this by exactly the points you cut | 2–4 weeks | Lower fulfilment rates usually come attached to a volume commitment, and partners on lower commission put their effort where the rate is better. |
| Fast Check each entry's base | Confirm on Cost Settings that per-order fees are entered per order and percentages against the right metric | The number becomes true — often worse | Same week | Net Profit moves the day you fix it. The cost was always being paid; only the reporting changes. |
| Slow Raise order size so per-order fees spread | Add a threshold or a bundle so a flat per-order fee sits on a bigger basket | This column falls with no rate touched | 1 quarter | Bigger baskets built with discounts are paid for in margin. Read % Product Discounts beside AOV before you count it as a saving. |
| Slow Re-tender fulfilment | Take pick-and-pack and warehousing to two competitors before renewal | The largest per-order rate falls and stays down | 1–2 quarters | Switching partners costs weeks of ramp-up, and service dips through the handover — complaints and refunds usually rise before the saving shows. |
Every lever costs something somewhere. The last column is the one to read twice.
Read it with
Per-order rates don't care about revenue, they care about how many orders it arrived in. Reading this against your order count is what separates a rate problem from a basket problem.
More orders, smaller baskets
Order count grew faster than revenue, so every per-order fee is landing on a thinner basket. The rates are innocent here; the mix isn't.
Growing the right way
More orders and a smaller share of each euro going to fees. Revenue outgrew the order count, which means baskets got bigger.
Fewer, cheaper orders
A quieter month made worse by shrinking baskets. Nothing was overspent, but each remaining sale is carrying more of the fixed-per-order cost.
Fewer, bigger orders
Order count fell and the share improved because what did arrive was larger. Efficient per euro, and still fewer customers.
The operating half and the marketing half of the same rate-based cost base. They add to % Variable Custom Expenses, so a rise in the total means nothing until you know which half moved — one is a fulfilment and commission question, the other is an agency and affiliate one, and they have no fixes in common.
Custom expenses are deducted in Net Profit and in no margin above it. When Gross Margin holds and Net Profit Margin slips, this column is one of the few places the difference can be hiding, and it's the one you can renegotiate.
Common misreads
Gross Margin takes only COGS off Total Sales. Not one euro of this column is inside it, and neither is shipping, payment fees or advertising.
Only if every variable entry is a percentage of sales. Per-order fees push it above the headline rate, and an entry that started mid-period is prorated by the days it covered, so it reads lower than the rate for that range.
The bill shrinks, the share doesn't have to. Per-order fees against smaller baskets can push this up while the invoice falls, which is the shape most likely to be misread as overspending.
Also called
Operating variable cost share · non-marketing variable cost ratio · variable cost of fulfilment
See yoursYour operating variable share for the period, beside the marked marketing half and the entries behind both on Cost Settings.
Open Shopify Profit →