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You are a senior ecommerce operations analyst who specializes in finding the margin leaks that don't show up on a simple P&L. Your job is to identify which SKUs are silently destroying profit — not the obvious losers, but the ones that look fine until you factor in the costs operators routinely ignore.

I'm going to provide SKU-level data below. For each SKU, calculate true profitability by layering in the following cost categories in order:

LAYER 1: Base margin
- Sell price − COGS − inbound freight per unit = gross margin

LAYER 2: Amazon fees
- Gross margin − referral fee − FBA fulfillment fee = post-fee margin

LAYER 3: Return cost
- Return rate % x (return processing cost + lost margin on returned unit) = return cost per unit sold
- Post-fee margin − return cost per unit sold = return-adjusted margin

LAYER 4: Storage cost
- Monthly storage fee x average months in storage = storage cost per unit
- If long-term storage fee applies (inventory aged 180+ days), add it here
- Return-adjusted margin − storage cost per unit = fully-loaded margin

Output format:

A table with columns:
SKU | Sell Price | Base GM% | Post-Fee Margin% | Return-Adj Margin% | Fully-Loaded Margin% | Flag

Where Flag is one of:
- HEALTHY (fully-loaded CM% > 20%)
- MARGIN LEAK (fully-loaded CM% 10-20% but 10%+ lower than base GM% — the hidden cost drag is significant)
- AT RISK (fully-loaded CM% 0-10%)
- LOSS LEADER (fully-loaded CM% < 0%)

After the table, produce a "Hidden Loss Leaders" section listing only the SKUs flagged MARGIN LEAK, AT RISK, or LOSS LEADER, with a one-sentence explanation of what's killing the margin on each (returns? storage? fees?).

Close with a "What to do" section: 3-5 prioritized actions across the catalog, ranked by dollar impact.

Think through the layered calculations step by step before producing your final answer.

BEFORE YOU EXECUTE:

1. If any required input is missing, unclear, or looks malformed, stop and ask me a specific clarifying question before proceeding. Do not guess or fill in plausible values.

2. If you are less than 95% confident you understand what I'm asking for, ask me to clarify before executing the task.

3. If the data I've provided contradicts itself, flag the contradiction and ask how to resolve it before continuing.

4. If executing this task would require information you don't have access to, tell me what's missing instead of fabricating it.

5. Verify every arithmetic calculation by working it twice. Do not round intermediate calculations; round only the final figures to two decimal places.

6. If any SKU shows a fully-loaded margin more than 20 percentage points below its base gross margin, flag it as a high-priority anomaly and identify which cost layer is responsible.

7. After completing the task, note any assumptions made and flag anything that looks unusual under a "Caveats" section.

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PASTE YOUR SKU DATA BELOW. For each SKU include: sell price, COGS, inbound freight per unit, Amazon referral fee %, FBA fulfillment fee, return rate %, return processing cost, monthly storage fee per unit, average months in storage, and long-term storage fee if applicable. If a value is unknown, write "unknown" and I will note it as an assumption.

[YOUR DATA HERE]
What you'd paste after the divider
SKU: YOGA-MAT-PRO
Sell price: $38.00
COGS: $9.50
Inbound freight per unit: $1.20
Referral fee: 15%
FBA fulfillment fee: $6.10
Return rate: 18%
Return processing cost: $4.00
Monthly storage: $0.18
Avg months in storage: 2.5
Long-term storage fee: $0

SKU: FOAM-BLOCK-SET
Sell price: $22.99
COGS: $5.80
Inbound freight per unit: $0.90
Referral fee: 15%
FBA fulfillment fee: $4.95
Return rate: 6%
Return processing cost: $3.50
Monthly storage: $0.22
Avg months in storage: 4.0
Long-term storage fee: $1.50
01

The return rate and average months in storage are the two inputs most sellers don't have ready. Pull return rate from your Returns Report (last 90 days) and storage duration from your Inventory Age report in Seller Central.

02

A high return rate on a low-margin product is almost always a loss leader in disguise. The math usually makes it obvious once you run it.

03

Run this quarterly — storage costs and return rates shift seasonally, and a SKU that was healthy in Q1 can be a loss leader by Q4 if inventory ages through a slow period.

What does the Identify Your Hidden Loss Leaders prompt do?
Some of your best-selling SKUs are quietly losing money. This prompt ingests your SKU list and flags products that look profitable on the surface but lose money once returns, long-term storage fees, and aged inventory costs are factored in.
What data do I need to use this prompt?
An example of the exact input format is provided on this page under "Example Input." Generally you'll prepare your data in the structure shown, paste it after the prompt body, and the AI will return the analysis described above. If you're missing any inputs, the prompt will ask you what it needs.
How long does this take to set up?
Setup time for this prompt is 30-60 mins. That includes pulling your data, formatting it to match the example, and running the prompt. Once your data pipeline is set up the first time, subsequent runs take only a few minutes.
Which AI tool should I use this with?
This prompt is designed to work with any major large language model — ChatGPT (GPT-4 or newer), Claude (Sonnet 4 or newer), or Gemini. For structured analysis, math, and tabular outputs, Claude and GPT-4 class models produce the most reliable results.
Does this prompt work for Shopify or other platforms?
This prompt is built for Amazon sellers and references Amazon-specific data points such as referral fees, FBA fulfillment fees, and ASIN-level metrics. The underlying methodology can be adapted to other platforms by substituting equivalent inputs, but the prompt as written is Amazon-first.
What skill level is required to use this prompt?
This prompt is rated intermediate. Some familiarity with your platform's data exports and basic AI prompting is helpful for getting the most out of it. Most ecommerce operators can use it productively within a single session.
Is this prompt free to use?
Yes. Every prompt in the SMB Advantage Prompt Library is free for any small business operator to use. The only cost is whatever you pay for your AI tool subscription (ChatGPT Plus, Claude Pro, etc.).
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