10 Must-Have Reports for Shopify Merchants
As of the time of writing, our Report Toaster app has 80+ pre-built report templates to help merchants analyze and operate their Shopify storefronts. However, we are often asked by merchants to provide recommendations about our most popular or most important reports, so we thought it would be a good topic to write about!
In this article, we will go over 10 must-have reports for Shopify merchants.
Know Your Profits!
As my friend Tia from Mastering P.o.P would say, know your profits! Sales are great, but what good are they if they're not profitable?
We've written in the past about tracking gross profit, which we've defined as net sales minus cost of goods sold (COGS). We've also explained net profit or true profit, which accounts for order expenses such as shipping costs and credit card Transaction Fees.
So let's look at a few of the reports that are 'must-haves' for tracking profit.
Profit By Month
The Profit By Month report tracks gross and net profits by month over the past year. Profits are charted over time, allowing merchants to determine, at a glance, whether profits are improving or declining month over month.
According to this article from Shopify, a good gross profit margin for online retail is around 45.25%. Therefore, the Profit By Month report can be used to track monthly sales against that benchmark.
Most Profitable Products
The Most Profitable Products report provides a list of products, sorted by those that are the most profitable. The purpose of this report is to provide insight into the products that are most valuable to a shop's bottom line.
For those high-margin products at the top of the list, there are a few options:
If a high-margin product is selling well, it should be promoted using techniques such as product recommendations, upselling, and discounts.
If a high-margin product is not selling well, consider lowering the price. This article from Shopify covers some of the best practices for product pricing.
As we get to the bottom of the list, options must be considered for low-margin products:
If a low-margin product is selling well, consider raising the price.
If a low-margin product is not selling, try bundling it with high-margin products. If this doesn't work, it may be time to stop selling the product altogether.
Profit by Order
The Profit by Order report provides a list of orders for the last 30 days, which includes all the components to calculate an order's true profit. There are even a few components included here that aren't available in any of the built-in Shopify reports!
Shipping Costs - These are the costs incurred when shipping products to a customer. This report will show how shipping costs compare to what is being charged to a customer. Shipping doesn't need to necessarily be a profit center, but you certainly want to avoid it being a significant source of loss.
Transaction Fees - These are the fees a merchant is charged by the payment gateway used for an order (e.g. Shopify Payments and PayPal).
In many cases, Report Toaster can derive the shipping costs and transaction fees automatically. When that's not possible, we can use our integration with Mechanic to retrieve costs from sources such as ShipStation and Pirate Ship.
'Sales Never Fails'
Of course, no list of reports would be complete without addressing sales. So we've added a few of our favorite sales reports to the list of 'must-have' reports.
Average Order Value Over Time
The Average Order Value Over Time report tracks AOV by month over the past year and charts it over time. This report allows a merchant to analyze if AOV is increasing or decreasing relative to previous periods.
This article explains the importance of average order value and gives some tips for increasing it. Once some strategies to increase AOV have been determined, Report Toaster can be used to analyze the results.
Sales by Discount Code
The Sales by Discount Code report tracks sales over the last 30 days, aggregated by any discount codes used at the time of sale. The purpose of this report is to analyze which discount offers are leading to actual sales.
In this article, Shopify explains that discount promotions are one of the most common approaches for increasing retail sales. Whether using a tool like PushOwl (to offer discounts via push notification) or Klaviyo (for Email and SMS offers), the Sales by Discount Code report can track and report the effectiveness of these efforts.
Sales by UTM Campaign
The Sales by UTM Campaign report tracks sales over the last 30 days, aggregated by the UTM Campaign attributed to each sale. The purpose of this report is to determine which campaigns are leading to sales and which are just costing you time and money.
We find that most merchants don't properly utilize UTM parameters in their marketing efforts. This leads to a lot of money being spent on marketing without being able to actually measure the results. This article is a good primer on how merchants can properly use UTM parameters to track which sales are attributed to different marketing channels.
Once properly implemented, the Sales by UTM Campaign report is the perfect tool for measuring results for all marketing efforts (at which point, you will probably wonder where UTM parameters have been all your life!)
Customers are the lifeblood of any eCommerce business, so we've included a few of our favorite reports to help merchants analyze customer trends.
Customer Lifetime Value
The Customer Lifetime Value report tracks the average customer LTV over the history of a shop. This report allows a merchant to analyze if customer LTV is increasing or decreasing as time goes on.
Just like AOV, merchants should always be taking measures to increase the lifetime value of their customers. This article from Shopify helps explain how customer LTV is calculated and some strategies you can use to help increase it. Luckily, Report Toaster will take care of the reporting so that you can focus on your strategy.
First-Time vs. Returning Customer Sales
The First-Time vs. Returning Customer Sales report shows the percentage of first-time versus returning customers for the current year-to-date. The purpose of this report is to determine how a shop is performing in terms of customer retention.
Industry experts cite that a repeat purchase rate from 20-40% is a standard range. In comparison, Shopify has found that a 27% repeat purchase rate is considered a good baseline. If you find your repeat purchase rate is lower, this article from Shopify goes over some good strategies for increasing customer retention.
No list of 'must-have' reports would be complete without including some inventory-related insights.
The Inventory Value report provides a list of products, available quantities, and total values (measured by both price and cost). The purpose of this report is to help a merchant understand their inventory levels so that any appropriate action can be taken.
This article from Shopify explains common strategies for managing and improving inventory management. This one is a doozy, but one statement really stands out.
Not only is good inventory management more cost efficient; it improves cash flow in other ways too. Remember: inventory is product you’ve likely already paid for with cash (checks and electronic transfers included), and you’re going to sell it for cash. But while it’s sitting in your warehouse, it’s definitely not cash.
In short, if you have too much cash tied up in inventory, it is likely affecting other areas of the business. This means less money for marketing and other expenses or just less money in your pocket.
On the flip side, if inventory is low then it may be difficult to fulfill orders on time. This can lead to customer frustration and a whole different set of problems. The lesson here is that by using Report Toaster, you can keep cash flow and operations running smoothly!
Dead Stock Products
The Dead Stock Products report provides a list of active products that have not sold for the past 365 days. The purpose of this report is to help a merchant identify inventory that is stale and unlikely to sell in the future.
Shopify explains the importance of addressing dead stock in this article. To summarize though, there are a few key reasons why a merchant should address dead stock:
Storing dead stock costs money to the warehouse.
Listing dead stock on a storefront consumes valuable clicks that could be directed to products that are selling.
The longer the product sits, the more it is costing you over time.
Using the Dead Stock Products report is an easy way to identify these unsold products.
Back in our first blog post, we wrote about our goal of providing easy-to-use, yet powerful, data-driven productivity tools for Shopify merchants. We believe we have accomplished that goal, as Report Toaster provides insights that simply can't be found anywhere else.
But it's easy to get caught up in functionality, Sometimes, it's nice to just take a step back and focus on what really drives users to our app.
That's why we created this list of 10 'must-have' reports, so we can share with you the data that our merchants have found most valuable. With luck, this will give some of you an amazing place to start - and then these reports are all fully customizable so you can tailor them to your business.
We're always on the hunt for new data and reports that you find useful. If there's a report that you would like to see or need some help creating, feel free to reach out to us and let us know!