Why is my ROI calculation not correct ?
AZInsight uses the following formula to calculate your Return on investment (ROI). Return on Investment = Net Profit / Investment. We provide you with three options to define what how you define the Investment variable in the formula. Setting this is done in the Calculator Settings Screen.
Those three ways are:
1. Your investment equals your buy cost
2. Your investment equals your buy cost plus any custom costs
3.Your investment equals your buy cost plus any custom costs and the amazon fees
Terms used above
buy cost = cost for you to purchase the products
custom costs = costs you manually put into AZInsights custom cost
amazon fees = the Fees amazon indicates it will charge you to sell this product
Scenario One: Assume you want to calculate ROI only based on what you set as a buy cost.
Option you need to choose: You need to set AZInsight to Option 1
Scenario Two: Assume you want to calculate ROI only based on what you set as a buy cost and also include amazon fees
Option you need to choose: You need to set AZInsight to Option 3