Glossary
The biggest number on the dashboard.
GMV is the total value of everything sold in a period, before a single deduction comes off. It is the biggest number on the dashboard, and the vainest.
GMV = units sold × selling price (before returns, discounts and fees)
return rate 8%
average discount 10%
after returns, discounts and fees, your $100,000 of GMV is really $79,000 — $21,000 of it never reaches you.
The vanity and the value
GMV counts every unit at the price on the tag, at the moment it sells. Revenue is what you actually collect once discounts come off; net revenue is what survives returns and payment fees. The three numbers descend in that order, and so does their honesty. GMV is the easiest of them to grow and the hardest to bank — you can double it overnight with a forty percent sale and end the month poorer.
Marketplaces report GMV because most of it was never their money: a platform that moves a billion dollars of goods at a ten percent take rate is a hundred-million-dollar business wearing a billion-dollar coat. Investors read the same statement two ways — growth from GMV, health from gross margin. When the two diverge for long, the coat is doing the talking.
When GMV is the right number
GMV is the honest measure of throughput: how much merchandise moved through the store, the warehouse, the couriers. Use it to size operations, negotiate shipping rates and compare seasons — Black Friday is a GMV event before it is a profit event. It is also the fairest scoreboard for top-of-funnel work: a lift in AOV raises GMV on the same traffic, and every checkout rescued from cart abandonment lands there first. Just never let it stand alone. Put net revenue on the same chart, and make the gap between the two lines the thing you manage.
Made with care by Astral Commerce