5 Hidden Signals That Your E-commerce Is Losing Money – and Why Most Owners Don’t Notice Them

Polish e-commerce is growing at a double-digit rate, but up to 30% of profits can vanish due to hidden costs. The latest reports show that returns, discount policies, rising marketing costs, and wrong pricing decisions are becoming the biggest challenges in the industry. Financial expert Mary Tchir (CEO, Fractional CFO), who has been supporting online stores in Poland and Europe for 12 years, points to five areas where companies are losing money – even though it doesn’t show in their reports.

Returns: the hidden enemy of your P&L that quietly “eats” your business

According to the report “E-commerce in Poland 2025” prepared by e-Izba and Mobile Institute, the average return rate in Polish e-commerce reaches 13%, and in the fashion industry it exceeds even 40%. In the electronics category, this figure is 12–15%. This means that in many companies, every eighth order does not end in a sale but in a loss.

Returns are often seen in e-commerce as a “natural part of business,” especially in niches like clothing, footwear, or electronics. In practice, however, returns are one of the most underestimated factors affecting profitability. Many entrepreneurs believe that since returns are reflected in the P&L (Profit and Loss statement), they remain under control. But the problem runs deeper. Each return is not only a loss of revenue but also a whole chain of costs, from logistics and commissions to warehouse work. A product worth €23 can actually cost the company €32–47. What’s worse, most stores look at returns collectively, failing to notice that in some channels or categories they reach as much as 40–50% – and that is where the margin is disappearing.

That’s why we strongly recommend that e-commerce entrepreneurs:

• Count returns by channels and products. Break down the return rate by each traffic channel and each product category. This gives a clear picture of where money is being lost.
• Include all costs of returns. Add logistics, packaging, warehouse work, and marketplace commissions to the calculation.
• Analyze customer behavior. Returns are often linked to a specific customer segment or marketing strategy (for example, aggressive discounts attract “try-out” buyers).
• Implement quality control and detailed product descriptions. Better photos, video reviews, and sizing guides can reduce returns by 5–10%.
• Develop a resale strategy for returns. Reselling or using discount channels for returned items helps reduce money frozen in stock.

The gap between LTV and CAC: when new customers generate losses instead of profit

At first glance, large baskets and a growing number of new customers look like signs of healthy growth. But in practice, some online stores fail to notice that in the race for sales, they invest in customers who will never pay off. Online ad spending in Poland rose by nearly 20% year-on-year in 2024 (IAB Polska data), and within the Meta ecosystem alone, the average cost per thousand impressions (CPM) increased by about 8% (Sotrender). This means that every campaign today is more expensive than a year ago – and if companies don’t measure LTV (Lifetime Value), the real long-term value of a customer, they may unknowingly be subsidizing their sales.

— “I remember an Instagram campaign for our cosmetics store. The first results looked great. But after calculating margin and acquisition cost, it turned out we were losing about €5 on every first order. Profit appeared only with customers who bought regularly — €28 every two weeks. Their annual LTV was €670, while acquisition cost was the same, €19. That opened our eyes: we’re looking not for expensive, but for loyal customers,” says Mary Tchir, CEO and Fractional CFO.

What entrepreneurs can do to reduce the risk:

• Calculate CAC for each channel. Just take monthly ad spend and divide it by the number of new customers. You immediately see which channels are too expensive.
• Estimate LTV at least over 6 months. Average basket and purchase frequency, even approximately, show the difference between “profitable” and “expensive” customers.
• Segment customers. The RFM model (Recency, Frequency, Monetary) quickly highlights the segments that generate the most profit.
• Lower CAC with simple steps. Testing new creatives, lookalike audiences, or optimizing the site for better conversion rate (CVR) can significantly improve marketing efficiency.

Even after basic calculations, you can turn off ineffective campaigns, redirect budget to lower-CAC channels, and focus on acquiring more valuable customers. This often increases profit margin by 10–20% without extra ad spending.

Discounts and seasonality: invisible enemies of margin

Discounts are e-commerce’s favorite tool. Sales almost always generate a spike in turnover and site traffic. The problem is, they are rarely calculated in terms of real margin. Store owners usually see a “beautiful sales growth chart,” but once marketplace commissions, logistics, packaging, and returns are included, it turns out the campaign was loss-making.

Research shows that over half of consumers in Poland value promotions and discounts not only during sales periods, meaning stores are constantly under price pressure. In peak season, ad and logistics costs rise further, while return rates exceed the average. In “off-season” months, demand drops, and aggressive discounts eat into margin even more.

An example from ExpertHUB says it all: an electronics store increased turnover by 60% during Black Friday, but its margin fell to 5%, and returns exceeded 20%. The result? Logistics costs, frozen warehouse capital, and loss instead of profit.

What entrepreneurs can do:

• Calculate margin for each SKU. Even a simple table including cost of goods, marketplace commission, delivery, and packaging will show which products cannot be heavily discounted.
• Check ROI of campaigns. Take one campaign from last month, add all ad and logistics costs, plus returns – you may be surprised how unprofitable it was.
• Separate strategy by season. Calculate marketing budgets and costs separately for peak (November–December) and off-season.
• Plan inventory according to demand. Review purchasing with seasonal trends in mind, to avoid freezing money in excess stock.

Hidden marketing costs: when “effective” channels are actually burning your budget

In e-commerce, marketing is often seen as the growth engine. Owners see a nice ROAS (Return on Ad Spend), charts in ad panels going up, and it seems like the business is scaling. But ROAS is often misleading. It shows only the relation between revenue and ad spend, ignoring cost of goods, marketplace commissions, logistics, or team salaries.

As a result, entrepreneurs look at numbers like “ROAS 4.5 — ads pay off 4.5x.” Meanwhile, real marketing profitability (ROMI, Return on Marketing Investment) may be negative. For example, with a margin of 25% and logistics that “eats” 10%, a campaign with ROAS 4.5 can actually generate losses.

This is not an isolated case – the lack of connecting marketing analytics with financials is one of the most common scaling barriers in Polish e-commerce. According to IAB Polska, online ad spending in Poland grew by over 20% in 2024, and in social media by as much as 30%. At the same time, the average cost per click (CPC) in Google Ads e-commerce campaigns in Poland rose by dozens of percent year-on-year, showing similar cost pressure as in social media.

That’s why entrepreneurs should:

• Calculate ROMI manually. Take ad spend for one channel, revenue from orders, and include cost of goods, commission, logistics, and returns. Even one such calculation can open your eyes.
• Add “invisible” costs to reports. If you use marketplaces, include their commission in cost of goods. If you have a team – count the cost of staff time.
• Track efficiency by SKU and channel. It may turn out one channel sells expensive low-margin products, while another – cheaper but much more profitable ones.
• Segment by device. Mobile channels often generate high CTR but low ROMI.

Even such a simple ROMI check in 2–3 channels can reveal that a significant part of the budget is being spent inefficiently. This allows reducing ad costs without lowering sales and redirecting money to channels that truly generate profit. Often this increases net profit by 15–30% within just a month.

Pricing “by eye”: how wrong pricing strategy and assortment turn sales into losses

According to a Strategy& / PwC report, more than half of Polish consumers compare prices in several stores before buying online. Pricing policy thus becomes one of the key competition fields and forces sellers into increasingly frequent adjustments. The problem is that in practice, these adjustments are often made in haste — intuitively, without proper cost and margin analysis. As a result, many e-commerce owners still set prices “by eye”: they look at the competition, add a markup, and assume that sales will naturally ensure profitability.

Meanwhile, the hidden cost lies in the details: marketplace commissions, logistics, packaging, returns, or discount campaign costs. For example, an item with a purchase price of €9 and an apparent margin of 50% (selling at €19) may yield a net profit of only €1–2 once delivery (€3), marketplace commission (10%), packaging (€1.40), and returns (15%) are included. One additional 20% discount is enough to make the sale unprofitable.

The problem is compounded by the lack of unit economics analysis – profitability of each product unit. Many entrepreneurs look only at turnover, but without SKU insight it’s hard to tell which products actually make money and which are just “dead weight.”

What entrepreneurs can do:

• Implement full cost accounting. Even a simple Excel table including marketplace commissions, delivery, packaging, taxes, and return percentage.
• Conduct ABC-XYZ analysis. ABC shows which products generate 80% of revenue, while XYZ shows sales stability. Together, these data help make inventory decisions.
• Segment assortment by margin level. High-margin products as profit foundation, medium and low-margin as support or “traffic drivers.”
• Review discount strategy. Discounts should serve LTV growth, not desperate clearance.
• Use dynamic pricing. Automation allows reacting to changing costs and demand in real time.

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About Expert HUB

Expert HUB is a team of financial specialists supporting e-commerce in Poland and Europe. We help online store owners move from intuition to decisions based on numbers. Our mission is to show real profitability in everyday management, not in abstract reports. With our analyses, entrepreneurs regain margin control, see which channels and products truly earn, and which only consume the budget. The result: stable growth, better liquidity, and confident decisions.

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