Shipped COGS

 Shipped COGS is a core financial and performance metric in Amazon’s retail and vendor reporting.
It measures the cost-side value of products shipped to customers - not sales revenue - and helps Amazon and vendors assess profitability, efficiency, and demand trends over time.

Unlike Ordered COGS, which is based on purchase orders issued by Amazon, Shipped COGS only includes items that have actually left Amazon’s fulfilment centres (FCs) and reached end customers within the reporting period.

Key Components of Shipped COGS:

1. Vendor Cost Price:
   • The cost Amazon pays the vendor per unit (excluding freight or additional terms).
2. Volume Shipped:
   • The number of sellable units shipped to customers (not units ordered or received).
3. Time Period:
   • Reflects shipments within the selected timeframe (e.g., weekly, monthly, quarterly).

Formula:

Shipped COGS=Cost Price per Unit×Units Shipped to Customers

Example Calculation:

• Cost Price (from vendor): $25
• Volume Shipped: 1,000 units

Shipped COGS=25×1,000=$25,000

Use Cases in Amazon Reporting:

• Found in Amazon Retail Analytics (ARA) and RRA (Rapid Retail Analytics) dashboards.
• Used in P&L statements, profitability analysis, and business reviews (WBR, QBR).
• Integral to metrics such as PPM (Pure Profit Margin) and PPPU (Pure Profit Per Unit).

Relationship to PCOGS:

• Shipped COGS = PCOGS (Product Cost of Goods Sold) - they represent the same underlying cost metric but appear under different report labels depending on the reporting tool.
• Both exclude freight allowances, vendor funding, and marketing contributions.

Benefits for Amazon:

• Financial accuracy: Provides a real-time reflection of product cost exposure.
• Profitability tracking: Used to calculate category and ASIN-level margins.
• Inventory efficiency: Links cost data to shipped volume trends.

Benefits for Vendors:

• Transparency: Enables monitoring of how much product Amazon actually sold and shipped.
• Performance analysis: Helps align production, pricing, and replenishment planning.
• Strategic insight: Supports forecasting and RGM (Revenue Growth Management) reviews.

Challenges:

• Timing differences: Shipped COGS may lag behind Ordered or Received COGS due to fulfilment delays.
• Data granularity: Vendors often see aggregate values rather than ASIN-level breakdowns.
• Currency fluctuations: International vendors must track local vs USD cost conversions.

Why It Matters:
Shipped COGS is the foundation of Amazon’s cost and profit reporting, allowing both parties to understand the true cost base of shipped sales.
It provides the baseline for key profitability KPIs and informs negotiation discussions around pricing, trade terms, and investment efficiency.

Example in Practice:
A kitchen appliance vendor sees $200,000 in Shipped COGS for July.
Combined with $320,000 in shipped revenue, the gross margin = (Revenue - Shipped COGS) / Revenue = 37.5%, used in RGM and PPM calculations.

In short:
Shipped COGS (Shipped Cost of Goods Sold) measures the total vendor cost of all units shipped to customers during a period - calculated as Cost Price × Shipped Volume - and is equivalent to Amazon PCOGS.