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Pre TariffPost TariffPost Tariff, with adjustmentsPost Tariff, with adjustmentsPost Tariff, just cutting opex
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Visitors100,000100,000100,000100,000100,000
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Conversion Rate3%3%3%2.05%assuming huge drop in conversion rate3%
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# Orders30003000300020503000
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AOV (pre-discount) $ 100.00 $ 100.00 $ 108.00 8% increase in price $ 108.00 $ 100.00
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Discounts/Order $ (9.00) $ (9.00) $ (7.56)reduce discount rate from 9% of gross rev to 7% $ (7.56) $ (9.00)
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Net Revenue / Order $ 91.00 $ 91.00 $ 100.44 $ 100.44 $ 91.00
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COGS/Order $ (18.00)*ballpark $ (18.00) $ (18.00) $ (18.00) $ (18.00)
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Tariff costs / order $ - *ballpark $ (6.30)adding in 35% tariffs $ (6.30) $ (6.30) $ (6.30)
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Product Gross Profit / Order $ 73.00 $ 66.70 $ 76.14 $ 76.14 $ 66.70
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Shipping Revenue / Order $ 3.00 $ 3.00 $ 4.00 Get an extra $1 per order from shipping $ 4.00 $ 3.00
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Shipping & Fulfillment Cost / Order $ (8.00) $ (8.00) $ (8.00) $ (8.00) $ (8.00)
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Shipping Profit / Order $ (5.00) $ (5.00) $ (4.00) $ (4.00) $ (5.00)
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Gross Profit / Order $ 68.00 $ 61.70 $ 72.14 $ 72.14 $ 61.70
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Acquisition Cost / Order (CAC) $ (40.00) $ (40.00) $ (40.00) $ (40.00) $ (40.00)
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Opex / Order $ (19.00)*figure from taylor's tweet re: finaloop data. Avg opex is 19% for 8 figure brand $ (19.00) $ (19.00) $ (19.00) $ (12.70)
33% reduction in opex required to break even
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Contribution Margin / Order $ 9.00 9% contribution margin $ 2.70 $ 13.14 $ 13.14 $ 9.00
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Gross Revenue (Total) $ 309,000.00 $ 309,000.00 $ 336,000.00 $ 229,600.00 $ 309,000.00
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Net Revenue (Total) $ 282,000.00 $ 282,000.00 $ 313,320.00 $ 214,102.00 $ 282,000.00
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Contribution Margin (Total) $ 27,000.00 $ 8,100.00 $ 39,420.00 $ 26,937.00 $ 27,000.00
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-70.00%
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35% increase in tariffs reduced contribution margin by 70%
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