Revenue can grow while profit collapses
Most ecommerce dashboards report revenue as if it were the business. It isn't. Revenue is the surface. Margin is the structure underneath it.
Over the last 18 months, a pattern has appeared in almost every ecommerce audit we run.
Revenue is up. Sometimes significantly. But margin has eroded, return rates have climbed, and the cost of acquiring each incremental order has quietly outpaced the contribution it generates.
The common explanation is rising ad costs. That isn't the cause.
What's actually happening is a structural shift in how revenue compounds versus how cost compounds. Revenue grows linearly with spend. Cost compounds with complexity — more SKUs, more markets, more channels, more tools, more people coordinating more things.
Most reporting systems show revenue by channel. Almost none show margin by order after fulfilment, returns, and operational overhead. So the team optimises what the dashboard rewards: top-line growth.
The failure mode is quiet. Nobody notices until cash flow tightens. Then the conversation becomes about cutting costs instead of fixing the system that created the problem.
In practice, the stores we see growing profitably have one thing in common: they measure contribution margin per order, not revenue per channel. That single metric change alters every operational decision downstream.
The wrong metric doesn't give you the wrong answer. It asks the wrong question.
This is usually the point in an audit where the conversation changes from channels to architecture.