EUR 85 profit per order—what minimum order value do we need?
Depends on handling and COGS mix. Logistika Zadar sets EUR 150 floor on case B2B where handling EUR 25 and 65% COGS need revenue headroom.
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Profit Per Order
Profit Per Order: plain-English definition, formula, worked example, how to interpret the result, peer-based benchmark guidance, common mistakes, and management actions in the ZBI Business Control Library.
What is Profit Per Order?
Profit per order is order revenue minus order variable costs minus order handling cost—what you keep on that shipment after product cost and the cost to pick, pack, ship, and process the order. It is not customer profitability over a quarter (that aggregates many orders) and it is not basket margin without handling. Logistika Zadar closes a typical B2B replenishment order: revenue EUR 320, variable product cost EUR 210, handling cost EUR 25 (pick-pack, carrier allocation, payment processing). Profit per order = 320 − 210 − 25 = EUR 85. I segment by order profile because EUR 85 average hides EUR −12 on single-line rush orders under EUR 150.
Why Profit Per Order matters
Free shipping and 'no minimum order' policies destroy margin one small order at a time. At EUR 85 profit on a healthy order, Logistika Zadar funds operations; at EUR −12 on rush single-liners, volume campaigns multiply losses. E-commerce and inside sales see order count; finance needs profit per order by channel to see which profiles to restrict. Warehouse sees the same pick cost on a EUR 320 order and a EUR 95 order—handling EUR 25 is 26% of revenue on the small basket. Ignore profit per order and marketing celebrates order growth while contribution per shipment falls every month.
Formula and variables
Profit per Order = Order Revenue − Order Variable Costs − Order Handling Cost
Order revenue — net sales on the order (line discounts and returns allocated per policy).
Order variable costs — product COGS or variable cost for units on the order.
Order handling cost — pick, pack, ship, payment, and platform fees attributable to the order.
Excel: =B2-B3-B4
Real business example
Logistika Zadar sample May order #88421: revenue EUR 320 (four case lines to a HoReCa account); variable product cost EUR 210 (65.6% COGS); handling cost EUR 25 (EUR 14 warehouse pick-pack, EUR 8 carrier allocation, EUR 3 payment fee). Profit per order = 320 − 210 − 25 = EUR 85 (26.6% net on order revenue). Same week, rush order #88455: revenue EUR 118, variable EUR 79, handling EUR 38 (express pick and solo shipment)—profit EUR 1 before sales discount. Profile report flags single-line under EUR 150 with express as toxic; minimum order and shipping fee applied from June.
How to interpret the result
Profit per order is unit economics at shipment level—segment before averaging.
- EUR 85 on EUR 320 is healthy; average profit per order hides loss-making profiles.
- Handling EUR 25 must include real pick time and carrier cost—not only warehouse wage average.
- Compare by channel: B2B pallet, B2B case, e-commerce parcel—different handling rules.
- Free shipping threshold should be modeled against profit per order twice a year.
Benchmark context
B2B distributors often target EUR 50–120 profit per order on core replenishment profiles depending on mix—Logistika Zadar uses EUR 85 as mid-tier healthy. Flag profiles below EUR 15 or negative for pricing or minimum-order action. E-commerce parcel benchmarks against carrier rate cards—handling EUR 25 is tight if average order value falls under EUR 200.
Red flags
- Average profit per order flat while share of single-line orders up 20%—blend hides erosion.
- Handling cost model unchanged after carrier rate increase—profit per order overstated.
- Express rush profile negative three months running—no minimum order or surcharge enforced.
- Profit per order positive but below pick labor cost on half of e-commerce parcels.
- Volume campaign doubled orders on profiles with profit under EUR 10—contribution destroyed for leaderboard metrics.
Common mistakes
- Averaging profit per order without segmenting by lines, weight, and rush flag.
- Handling cost omitted—EUR 85 becomes EUR 110 fiction.
- Using list revenue while net revenue after line discount is EUR 320 not EUR 340.
- Campaign volume on profiles already negative—marketing multiplies EUR −12 orders.
- Free shipping threshold never modeled against handling and carrier on small baskets.
What should management do next?
- Calculate profit per order by channel including fees and pick-pack-ship.
- Segment by order profile—lines, weight, rush—and publish toxic profiles monthly.
- Implement minimum order value or shipping fee where small orders lose money.
- Model free-shipping threshold against profit per order twice a year.
- Pause volume campaigns on profiles with negative profit until pricing fixed.
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FAQ
Handling EUR 25—how do we calculate it?
Activity-based: pick minutes × rate, carrier allocation by weight zone, payment fee percent. Update when wage or carrier rates move.
Profit per order versus customer profitability?
Order is shipment economics; customer is quarterly roll-up with service cost like visits and terms. Use both—order fixes profile, customer fixes account.
Rush order profit EUR 1—charge customer or refuse?
Surcharge or MOQ first. Refuse only if strategic—key accounts get surcharge transparency, not silent subsidy.
Should marketing see profit per order by campaign?
Yes. Order count without profit per order invites campaigns that grow toxic profiles.
Summary
Profit per order is what you keep after product and handling cost on one shipment. Logistika Zadar's EUR 85 example is healthy; segment profiles, fix toxic small and rush orders, and model free shipping against real handling—not blended averages.
Reviewed by ZBI Business Control Library · Last updated 2026-06-15