The language of ecommerce profitability, explained.
A growing reference library for the metrics, formulas and economic concepts behind profitable ecommerce decisions — from contribution margin and pricing to acquisition, inventory, cash flow and marketplace economics.
Profitability is a system, not a single metric.
The glossary is organized around the economic systems that determine whether ecommerce growth creates or destroys value. Each category is prepared to become a dedicated cluster of connected definitions.
Profit & Margin
Gross margin, contribution margin, operating profit, net margin, profit per order and the core language of economic performance.
Pricing & Discounts
Markup, break-even price, discount depth, price elasticity, promotional economics and the relationship between price and required volume.
Marketing Economics
CAC, ROAS, MER, incremental acquisition, payback periods and the economics behind profitable customer growth.
Customer Economics
LTV, repeat purchase rate, retention, cohort contribution and the metrics that connect customer behavior to profit.
Inventory & Working Capital
Inventory turnover, dead stock, safety stock, sell-through, days inventory outstanding and capital tied up in products.
Cash Flow & Financial Health
Working capital, cash conversion, runway, operating cash flow and the difference between accounting profit and available cash.
Shipping, Fulfillment & Returns
Fulfillment cost, shipping contribution, refund exposure, return cost and the operational expenses that reshape order economics.
Marketplaces & Analytics
Marketplace fees, FBA economics, channel contribution, AOV, conversion rate and reporting concepts used to interpret performance.
50 essential ecommerce profitability definitions.
Start with the core metrics behind margin, pricing, acquisition, customers, inventory, cash flow and returns. Each definition includes a practical example and links to deeper MarginLab resources where relevant.
Core profitability
Gross Margin · Gross Profit · Net Profit · Profit Margin · Contribution Margin · COGS
Pricing fundamentals
Acquisition and customer value
Customer Acquisition Cost (CAC) · Customer Lifetime Value (LTV) · LTV:CAC Ratio · ROAS
Store performance
Working capital
Inventory Turnover · Dead Stock · Working Capital · Cash Flow
Post-purchase economics
Pricing decisions
Selling Price · Discount Rate · Price Elasticity · Minimum Profitable Price · Promotional Margin
Acquisition efficiency
Cost Per Click (CPC) · Cost Per Mille (CPM) · Click-Through Rate (CTR) · Marketing Efficiency Ratio (MER) · Return on Marketing Investment (ROMI) · Customer Acquisition Payback Period
Retention & customer value
Repeat Purchase Rate · Customer Retention Rate · Customer Churn Rate · Purchase Frequency · Average Customer Value · Customer Cohort
Stock efficiency
Days Inventory Outstanding (DIO) · Sell-Through Rate · Stockout · Safety Stock · Reorder Point · Economic Order Quantity (EOQ) · Inventory Carrying Cost
Financial health
Operating Cash Flow · Free Cash Flow · Cash Conversion Cycle · Business Runway
Built to become a reference library.
The library now contains 50 published definitions. Active letters indicate terms currently available; the index will continue expanding as new entries are added.
More than a dictionary definition.
Every future glossary entry will answer four questions: what the term means, how it is calculated or interpreted, why it matters economically, and how it connects to real ecommerce decisions. Important concepts can then link into MarginLab Lessons, Long Guides, Business Articles, calculators, Insights and Case Studies.
Learn the concepts. Then learn how they work together.
The Glossary is the reference layer of MarginLab Academy. Use it to understand a term, then move into structured lessons and deeper profitability research.
Explore MarginLab Academy →