Ecommerce net sales, an essential part of ecommerce accounting, represent the total value of sales an online store retains after accounting for returns, discounts, allowances, and other adjustments. This is the amount your business actually earns after all deductions are applied, providing an accurate measure of your store’s performance. For ecommerce businesses, this number is especially crucial as it reflects the real revenue after dealing with common issues like refunds or promotional discounts.
Tracking ecommerce net sales allows you to understand how much money your business is bringing in from actual transactions, without the noise from returns or refunds. If net sales are lower than expected, it could signal issues with customer satisfaction or pricing strategies. For example, a high number of returns may indicate a mismatch between customer expectations and the products offered. Analyzing your net sales alongside your gross sales gives you a more complete view of your ecommerce store's financial health.
Read our in-depth article about ecommerce net sales.
Ecommerce Net Sales Formula
Net Sales = Gross Sales − Refunds − Returns − Promotions − Discounts
The net sales is calculated by taking the gross sales and subtracting refunds, returns, promotions, and discounts.