# Order Costs

One of the most important variables we track is order costs. Order costs are the amount each order costs your web shop. If we subtract order costs from order total, we should be able to arrive at the profit per order.

There are many variables that affect order costs (shipping, taxes, etc.) - and this is why it's often easier for a web shop to calculate the costs themselves.

In the event that calculating order costs is too difficult - AristanderAI can use a simplified formula to calculate the profit:

order revenue - total net unit costs (per item) - taxes

For example, in the following order we have a total of 30.60, total taxes of 5.00, and total costs of 10.40.

{

"event_type" : "order",

"session_id" : "098f6bcd4621d373cade4e832627b4f6",

"event_details" : {

"products" : [

{

"product_id" : "106",

"quantity" : "2",

"item_price" : "1.26",

}

],

"order_costs" : [

["shipping", "5.00"]

],

"total" : "30.60",

"total_taxes" : "5.00",

"total_costs" : "10.40",

"currency_code" : "USD"

},

"api_version" : "1.0",

"plugin_version" : "",

"user_agent" : "Firefox",

"pricelist_source" : "aristander",

"price_mode" : "timeseries",

"model_params" : "912ec803b2ce49e4a541068d495ab570",

"timestamp" : 1565252389074

}

The profit for this order (what we are trying to maximize) would be 30.60 - 10.40 = 20.20.

If total_costs are not provided, the profit of the order would be 30.60 - (50 cent net unit cost of product ID 106 * 2) - 5.00 = 24.60

Last modified 3yr ago