Tracking cost of goods sold (COGS) as a clothing reseller

What COGS actually means

COGS is the cost of the stock you sold in a given period. Not the stock you bought — the stock you sold. If you spent £200 on stock in October but only sold items that originally cost you £70, your October COGS is £70. The other £130 is still sitting on your rail as unsold stock.

This distinction stops you from thinking you had a terrible month just because you bought a lot of stock, or a brilliant month because you sold old stock you'd already paid for.

What goes into an item's cost

• What you paid for the item (or its share of a bulk lot)
• Delivery you paid to get it to you
• Any buyer's fee you paid when buying it

Keep selling costs separate: platform fees charged to you, postage you pay to send items out, packaging and promoted listing costs. They're real costs, but tracking them in their own columns makes it much easier to see where money is going.

A simple system: one row per item

A spreadsheet is enough. Give every item a short code (an SKU) when it comes into your home — for example the month and a number, such as 2610-014. Write it on a small tag or in the listing's private notes so you can match sales to costs later.

Useful columns:

• SKU, item description, brand and size
• Date bought, where from, and cost
• Date listed and platform
• Date sold and sale price (what the buyer paid for the item)
• Postage charged to the buyer, if it was paid to you
• Fees charged to you, postage you paid, packaging
• Profit (worked out by a formula, not typed in)

The monthly ten-minute close

1. Filter your sheet to items sold this month.
2. Total the sale revenue, the selling costs and the item costs. The item cost total is your COGS for the month.
3. Revenue minus selling costs minus COGS is your profit for the month.
4. Filter to unsold items and total their cost. That's your stock at cost — money you've spent but not yet recovered.
5. Mark anything damaged, lost or given away as written off, so its cost doesn't hang around forever.

Keep your evidence

Save receipts or screenshots of what you paid for stock, and download or screenshot the order and payout details from the platforms you sell on. A folder per month is plenty.