How to Calculate Profit and Loss as a Reseller in Australia

Revenue vs Gross Profit vs Net Profit

These three numbers tell very different stories about your reselling business. Revenue is your total sales — what buyers pay you. Gross profit is revenue minus cost of goods sold (what you paid for the items). Net profit is gross profit minus all other expenses (fees, postage, packaging, storage, etc.). Net profit is the only number that tells you what you're actually earning.

Many resellers track revenue and assume they're doing well. A seller doing $5,000/month in revenue might only be netting $1,500 after COGS, fees, and postage — a 30% margin. Or they might be netting $500 — a 10% margin that barely covers the hours invested.

The P&L Formula for Resellers

Here's the formula that every reseller should know:

• Gross Revenue (total sales across all platforms)
• Minus COGS (what you paid for items that sold) = Gross Profit
• Minus Platform Fees (eBay, Depop, Shopify fees)
• Minus Postage & Packaging
• Minus Other Expenses (storage, software, phone, internet) = Net Profit

A Worked Example

Say you sell a jacket on eBay for $80. You bought it at an op shop for $8 (COGS). eBay charges a 13% final value fee ($10.40). You paid $12 for tracked postage and $2 for a satchel. Your net profit on that jacket is $80 - $8 - $10.40 - $12 - $2 = $47.60. That's a 59.5% net margin — excellent for reselling.

Now consider a different item: you buy a pair of shoes for $25, sell them for $45, pay $5.85 in eBay fees, $15 in postage (they're heavy), and $3 for packaging. Your net profit is $45 - $25 - $5.85 - $15 - $3 = -$3.85. You actually lost money. Without tracking each component, you'd never know.

Why Many Resellers Overestimate Profitability

The most common reason is ignoring COGS. If you don't track what you paid for items, you can't calculate gross profit — and without gross profit, your P&L is meaningless. The second most common reason is forgetting to include all fees. eBay alone has multiple fee types that collectively take 12-15% of your sale price. See our guide on COGS for resellers for more detail on tracking purchase costs.

Good bookkeeping practices ensure your P&L reflects reality, letting you make better sourcing decisions and understand your actual hourly rate.