What Is Net Sales in Print-on-Demand?

Learning profit tracking for the first time? Start with How to Calculate POD Profits (Step-by-Step). If you want to compare net sales against profitability, check Gross Profit vs Net Sales in Print-on-Demand. And if you’re ready to see live metrics synced automatically, try PodVector, built for Shopify + Printify/Printful sellers.

Definition of Net Sales

Net sales is your revenue after subtracting discounts, refunds, and canceled orders. It reflects the actual money your store brings in from sales before considering costs of production or operations. It’s one of the first adjustments sellers make to see a more realistic number than gross sales.

Formula for Net Sales

The formula is:

Net Sales = Gross Sales – (Discounts + Refunds + Returns)

Example Calculation

Let’s say your Shopify POD store records these numbers in one month:

• Gross Sales: $10,000
• Discounts/Coupons: $500
• Refunds & Returns: $700

Net Sales = $10,000 – ($500 + $700) = $8,800

This means while you technically made $10,000 in sales, your actual revenue after discounts and refunds is only $8,800. That’s the number you should use when calculating profit margins.

Why Net Sales Matters in POD

Net sales matters because it shows the money that really stays in your business. If you only track gross sales, you’ll overestimate your revenue and think you’re more profitable than you really are. In POD, where refunds and discounts are common, net sales provides a much more honest picture.

• Better forecasting: Net sales helps you predict future cash flow more accurately than gross sales.
• Profit margin accuracy: Since gross profit uses net sales as its base, you need clean net sales numbers for correct margin calculations.
• Marketing evaluation: If discounts drive sales but slash net sales too much, you’ll see it here.

Net Sales vs Gross Sales

Gross sales includes all orders at full price, no matter what. Net sales accounts for deductions like refunds and coupons. Example:

• Gross Sales: $5,000
• Net Sales: $4,300 after $700 in refunds and discounts

Gross sales looks better, but net sales is closer to reality. If you want a deeper breakdown, read Gross Profit vs Net Sales in Print-on-Demand.

Net Sales vs Gross Profit

Gross profit takes net sales and subtracts COGS. Example:

• Net Sales: $8,800
• COGS: $3,200
• Gross Profit: $5,600

Gross profit shows the money left after covering blank products and printing. Net sales is just the cleaned-up revenue before those costs.

Net Sales vs Operating Profit

Operating profit (or simply “profit” in PodVector) goes further than net sales. It subtracts everything—COGS, ads, shipping, refunds, and transaction fees. Net sales is an early step; operating profit is the final bottom line.

Benchmarks & What’s Normal

What’s a healthy ratio of net sales to gross sales in POD?

• 90–95%: Healthy. Small percentage lost to normal refunds or coupons.
• 80–89%: Some issues. Discounts or refunds may be too high.
• Below 80%: Dangerous. You’re giving away too much in promos or suffering from high return rates.

Most POD stores should aim to keep at least 90% of gross sales as net sales.

How to Improve Net Sales

• Reduce refunds: Improve product mockups, size guides, and shipping transparency.
• Limit discounts: Use promos strategically (e.g., free shipping thresholds, bundles) instead of blanket coupons.
• Track product-level returns: If one design causes frequent refunds, fix the issue or remove it.
• Encourage exchanges: Instead of refunding, let customers swap items to keep revenue in your store.

How to Track Net Sales

Manual Method

1. Export sales data from Shopify.
2. Subtract refunded orders and discounts.
3. Calculate net sales for the period.

This method works, but it’s tedious if you sell across multiple channels or offer lots of discounts.

Automated Method

PodVector syncs Shopify + Printify/Printful orders, automatically removes refunds and discounts, and shows live net sales, gross profit, and operating profit in one dashboard. No more spreadsheets.

FAQs

Is net sales the same as profit?

No. Net sales only subtracts refunds and discounts. Profit subtracts all costs, including COGS, ads, and fees.

What’s a good net sales percentage?

Try to keep at least 90% of gross sales as net sales. High refund rates or constant discounting can drag this down.

Does Shopify show net sales?

Yes. Shopify reports net sales separately from gross sales, but it doesn’t combine them with costs for profit. That’s where tools like PodVector come in.

Should I use gross sales or net sales for profit calculations?

Always use net sales. Otherwise, your profits will be overstated because you’re ignoring refunds and discounts.