| name | unit-economics |
| description | The Break-Even Calculator (BEC) model and Product Arsenal tracking schema from the Ecom Edge Product Arsenal workbook. Concrete formulas for Target CPP, breakeven quantity, net-profit margin accounting for RTO + delivery rate. Used by product-research (GO/HOLD economics), ads-manager (CPP kill/scale gate), store-manager (arsenal metafields), ops-planner (Notion Pipeline columns). Never approve a launch or judge an ad's CPP without running these numbers. |
Unit Economics — BEC model + Product Arsenal schema
Source: operator's docs/product-arsenal/Ecom_Edge_Product_Arsenal.xlsx (sheets: Products, BEC, Roposo). This skill is the canonical, versioned form of that workbook so every existing and new Shopify product is tracked and economically gated identically.
1. The Break-Even Calculator (BEC) — formulas (reverse-engineered, exact)
Worked from the sheet's own numbers (Selling ₹550, Cost ₹189, FAD 0.7, RTO 0.3, CPP ₹55, 100 orders → NET ₹17,610). Use these formulas verbatim.
Inputs (per product)
| Symbol | Name | Meaning |
|---|
SP | Selling price | What the customer pays (₹, GST-inclusive) |
C | Cost | Product cost per unit (supplier landed) |
FAD | Fulfilment/Delivery rate | Fraction of orders actually delivered (e.g., 0.70) |
RTO | RTO rate | Fraction returned-to-origin = 1 − FAD (e.g., 0.30) |
CPP | Cost per purchase | Ad cost to acquire one order (₹) |
RTO_cost | RTO cost per RTO'd order | Forward + return shipping eaten on a failed delivery (sheet: ₹72/RTO order) |
N | Total orders | Orders placed (delivered + RTO'd) |
Derived metrics
Profit per delivered order = SP − C
Revenue = N × FAD × SP (only delivered orders earn)
COGS = N × FAD × C
Gross profit = Revenue − COGS = N × FAD × (SP − C)
Gross margin % = Gross profit ÷ Revenue (sheet: 65.6%)
Total ad cost = N × CPP (paid on ALL orders, not just delivered)
Total RTO cost = N × RTO × RTO_cost
Total cost incurred = Total ad cost + Total RTO cost
NET PROFIT = Gross profit − Total ad cost − Total RTO cost
Net margin % = NET PROFIT ÷ Revenue (sheet: 45.7%)
Breakeven quantity = Total cost incurred ÷ (SP − C)
= (N×CPP + N×RTO×RTO_cost) ÷ (SP − C)
(sheet: 7660 ÷ 361 = 21.22 → need ~22 delivered orders
to cover the ad + RTO bleed)
Target CPP rule (the scale/kill gate)
From the BEC Target-CPP table (1000→80, 2000→160, 1599→127.92):
Target CPP = 8% of selling price.
This is the maximum acceptable cost-per-purchase. It's the operational translation of the break-even ROAS in docs/limits.md (1.6×) into a per-order ad-cost ceiling.
- Actual CPP ≤ 8% of SP → healthy, scale per
ad-scaling-rules
- Actual CPP 8-12% of SP → marginal, hold + optimize creative
- Actual CPP > 12% of SP → kill the ad set (per
ad-scaling-rules kill thresholds; CPP is the India-friendly metric — easier to read than ROAS for COD-heavy stores)
Examples: SP ₹899 → target CPP ₹72. SP ₹1,299 → target CPP ₹104. SP ₹1,499 → target CPP ₹120.
Hard economic gate for product-research
A product is not GO unless, at realistic FAD (default 0.70 for India COD) and CPP = 8% of SP:
NET PROFIT per total order = FAD×(SP−C) − CPP − RTO×RTO_cost > 0
If this is ≤ 0 at FAD 0.70, the product cannot scale profitably — score it HOLD/KILL in winning-product-criteria regardless of demand. Demand without unit economics is a money fire.
2. Product Arsenal tracking schema
Every existing AND new Shopify product must carry these fields. Where Shopify metafields make sense, store-manager stores them under namespace arsenal; the Notion Product Pipeline (managed by ops-planner) mirrors them as columns.
Core tracking (Products sheet)
| Field | Metafield / Notion column | Notes |
|---|
| Product Name | (title) | — |
| Status | arsenal.status | Idea / Researching / Sourced / Testing / Tested / Live / Killed |
| Ads Status | arsenal.ads_status | Not started / Testing / Scaling / Paused / Killed |
| Comments | arsenal.comments | Free text — test learnings |
| FB Ad URL | arsenal.fb_ad_url | Meta Ads Library link to the winning competitor ad |
| Ad URL 2 | arsenal.fb_ad_url_2 | Secondary reference ad |
| Competitor Website | arsenal.competitor_url | Their storefront (hand to competitor-spy) |
| Amazon URL | arsenal.amazon_url | Saturation + price-anchor check |
| AliExpress URL | arsenal.ae_url | Sourcing reference |
| Upsell | arsenal.upsell | The bump/cross-sell SKU paired at checkout |
Unit economics (BEC sheet, per product)
| Field | Metafield / Notion column |
|---|
| Selling price | arsenal.sp (also Shopify price) |
| Product cost | arsenal.cost (also Shopify cost-per-item) |
| FAD (delivery rate) | arsenal.fad (default 0.70 until real data) |
| RTO rate | arsenal.rto (= 1 − FAD) |
| Target CPP | arsenal.target_cpp (= 0.08 × SP, computed) |
| Actual CPP | arsenal.actual_cpp (from Meta, updated by marketing-analytics) |
| Breakeven qty | arsenal.breakeven_qty (computed) |
| Net margin % | arsenal.net_margin_pct (computed) |
Supplier tracking (Roposo sheet — generalises to any supplier)
| Field | Metafield / Notion column |
|---|
| Supplier | arsenal.supplier |
| Supplier cost | arsenal.supplier_cost |
| Supplier link | arsenal.supplier_url |
| Daily orders | arsenal.daily_orders |
| Delivery rate | arsenal.delivery_rate (= FAD, supplier-confirmed) |
| Tested (Y/N) | arsenal.tested |
3. Who uses this skill
product-research — run the hard economic gate (§1) before any GO. Capture FB Ad URL, competitor, Amazon, AE URLs in the brief. A 32/35 winning-criteria score still fails if NET PROFIT per order ≤ 0 at FAD 0.70.ads-manager — Target CPP (8% of SP) is the per-ad-set kill/scale gate. Pull actual CPP daily; CPP > 12% of SP = kill (aligns with ad-scaling-rules).store-manager — write the arsenal.* metafields on every product create/enrich. Set Shopify cost-per-item from arsenal.cost.ops-planner — mirror the arsenal schema as columns in the Notion Product Pipeline DB so the workbook and Notion never drift. Keep docs/product-arsenal/Ecom_Edge_Product_Arsenal.xlsx as the offline source-of-truth the operator edits.marketing-analytics — update arsenal.actual_cpp and arsenal.net_margin_pct daily from live Meta + Shopify; flag any product whose actual CPP breaches Target CPP.inventory-planner — arsenal.daily_orders × lead time feeds the reorder math in inventory-thresholds.
4. Hard rules
- Never approve a launch without NET PROFIT per total order > 0 at FAD 0.70 and CPP = 8% of SP.
- Never let an ad set run with actual CPP > 12% of selling price for >2 days (kill it).
- Always default FAD to 0.70 for a new India COD product until 50+ real delivered orders give a true rate; then use the real number.
- Always compute Target CPP = 8% of SP and store it on the product — it's the single number ads-manager checks.
- RTO_cost default ₹72/RTO order until courier invoices give the real figure; revise per supplier.
- The xlsx in
docs/product-arsenal/ is the operator's editable master. Agents READ the schema from this skill, WRITE values to metafields + Notion — they don't edit the xlsx.
