Magento stores what the customer paid for shipping. Your P&L needs what you paid the carrier.
Those numbers are only equal when you pass shipping through at cost. For everyone else — especially free shipping — treating charged shipping as cost understates expenses and inflates net profit.
The default trap
Many analytics tools (and many merchants) start with:
> shipping cost = Magento shipping_amount
On a free-shipping promo day that becomes:
> shipping cost = €0
Meanwhile DHL / Correos / Packlink still invoiced you €4–€12 per parcel.
Your dashboard celebrates margin. Your bank account does not.
Charged vs cost
| Concept | Source | Meaning |
|---|---|---|
| Shipping charged | Magento order | What the customer paid |
| Shipping cost | Your rules / carrier invoice | What fulfillment cost you |
Net profit must subtract cost, not charged.
Practical Magento patterns
Pass-through stores Customer pays roughly what you pay. Using charged as cost is acceptable as a starting point.
Free shipping over €X Charged drops to €0 while cost stays. You need rules or a fallback € / % of revenue.
Flat rate €4.95, real cost €7.20 Charged understates cost every single order.
Marketplace / mixed methods shipping_method codes differ (flatrate, dhl, packlink, etc.). Method CONTAINS rules beat one global number.
A minimal rule set that works
- Turn off “use charged shipping as cost” if free shipping is common
- Add method rules where you know carrier economics
- Set a fallback fixed or % of revenue for unmatched methods
- Recompute a recent week and compare to the carrier invoice
You do not need perfect carrier-rate API integration on day one. You need to stop booking €0 cost on free-shipping volume.
How this shows up in Verid
Verid stores Magento charged shipping for transparency, then applies merchant shipping cost config:
- Use charged as cost (default for pass-through)
- Or method rules + fallback fixed / percent
If charged shipping stays near zero while order volume is high, Verid warns that shipping cost is likely understated — so you fix rules before trusting net profit. Pair this with honest COGS or ROAS will keep lying politely.
One-week experiment
Export last week’s carrier invoice total. Compare to “shipping” in your profit dashboard.
If the dashboard is dramatically lower, you have been scaling ads on margin that never existed. Docs: /docs/shipping.