Rank first-quarter test products by contribution margin after Amazon fees, ad-adjusted. Score each product on margin per unit, conversion rate, cost per acquisition trend, and sell-through, then divide ninety-day contribution by the cash tied up in inventory and ads. The highest ratio gets the next reorder; the lowest gets cut.
The short version
- Rank by contribution per dollar deployed. Not by revenue, and never by ROAS alone.
- Use a ninety-day window. Shorter rewards luck, longer delays the reorder decision.
- Stage-adjust the advertising read. A launch product and a mature product cannot be judged on the same ACoS number.
- Count the cash, not just the margin. A product sitting in six months of stock is losing to one that turns monthly.
- The ranking exists to force an action. The top earns a reorder, the bottom earns a deadline or a cut.
Define the metric before the argument starts
First-quarter reviews turn into opinion contests unless the metric is agreed in advance. Mine is simple: ninety-day contribution margin divided by the cash the product consumed to earn it.
Contribution margin is revenue minus landed cost, minus Amazon's fees, minus every advertising dollar attributed to the product. The cash consumed is your inventory at cost plus that ad spend. The division produces one number per product, and it answers the only first-quarter question that matters: which product turns capital into profit fastest, because that product funds everything else you want to do. A single-product launch ties up $8,000 to $15,000 of capital all-in, so the reorder decision this ranking drives is usually the largest check of your second quarter. The same arithmetic runs underneath our Amazon FBA launch service, because a first order that cannot survive this division should not be placed.
The ranking checklist
- Pull the true landed cost per unit. Done properly means factory price plus freight, duty, and prep. The invoice line alone understates cost and flatters weak products.
- Subtract Amazon's fees from the fee reports. Referral fee, fulfillment fee, and a monthly storage allocation per unit. From the reports, not from memory.
- Attribute advertising at product level. Campaigns serving several ASINs get split by clicks, and the split is written down so nobody re-litigates it in the review meeting.
- Read ACoS against the product's stage. We set targets that change by stage, aggressive at launch and efficient at maturity. A twelve-week-old product with a heavy ACoS can be exactly on plan, while a mature product with the same number is bleeding. Ranking both on the raw figure punishes your future catalog to flatter your past one.
- Compute the ninety-day contribution. Revenue minus everything above. A negative number is allowed in quarter one. Hiding it is not.
- Count the deployed cash. Inventory at cost sitting in FBA plus the quarter's ad spend. This is the denominator, and products with fat stock positions will hate it.
- Check the CAC trajectory before finalizing. Falling acquisition cost with stable conversion is a product finding its footing. Rising CAC with falling conversion is a product telling you something you should hear.
- Rank, then act the same week. The top product earns the next purchase order and more test budget. The bottom one gets one named fix and a four-week window, or it gets cut.
What most agencies will not tell you
A first-quarter ROI table is easy to game. Cut advertising and margin improves immediately, while rank decays on a lag that lands next quarter. An agency paid a percentage of ad spend will never volunteer this ranking, because the honest version sometimes concludes with spending less. And raw return metrics systematically flatter mature products while punishing launches, so a naive ROI sort quietly starves every new product to feed the incumbent. Stage-adjusting the read, as in step four, is the correction, and it is the step most reporting decks skip.
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Prefer the table maintained for you every week, with the reorder call argued in writing, at Flapen.
