--- title: "Subscription first order vs renewal calculator" description: "Margin on a subscription's first order and on each renewal, and the expected profit per subscriber over time at your retention, against a one-time buyer." url: https://offersuite.io/calculators/subscription-first-order-vs-renewal updated: 2026-10-13 --- # Subscription margin: first order vs renewal Most subscribe-and-save offers price the first order lower than every renewal and put a welcome gift in the first box. So the first order earns little or loses money, and a subscriber is worth more than a one-time buyer only after enough renewals. This prices both orders and follows a subscriber through the renewals they are likely to stay for. ## Result The first order earns **$3.79** and each renewal **$11.68**. Over 12 orders a subscriber is expected to earn **$58.90**, against $15.36 from a one-time buyer, and passes it at order 3. ### First order Revenue $32.00 to contribution margin $3.79 (11.8%) Revenue $32.00 Cost of goods −$16.00 Pick and pack −$1.18 Extra picks −$0.20 Packaging −$0.50 Shipping label −$7.50 Card fee per order −$0.30 Refunds −$1.60 Card processing −$0.93 Contribution margin $3.79 1 declared kind costs nothing on this option ### Renewal Revenue $36.00 to contribution margin $11.68 (32.4%) Revenue $36.00 Cost of goods −$12.00 Pick and pack −$1.18 Packaging −$0.50 Shipping label −$7.50 Card fee per order −$0.30 Refunds −$1.80 Card processing −$1.04 Contribution margin $11.68 2 declared kinds cost nothing on this option Margin per order: first order at $32.00, renewal at $36.00 | Per order | First order | Renewal | One-time | | --- | --- | --- | --- | | Revenue | $32.00 | $36.00 | $40.00 | | Cost of goods | −$16.00 | −$12.00 | −$12.00 | | Pick and pack | −$1.18 | −$1.18 | −$1.18 | | Extra picks | −$0.20 | $0.00 | $0.00 | | Packaging | −$0.50 | −$0.50 | −$0.50 | | Shipping label | −$7.50 | −$7.50 | −$7.50 | | Card fee per order | −$0.30 | −$0.30 | −$0.30 | | Refunds | −$1.60 | −$1.80 | −$2.00 | | Card processing | −$0.93 | −$1.04 | −$1.16 | | Contribution margin | $3.79 | $11.68 | $15.36 | | Margin % | 11.8% | 32.4% | 38.4% | Expected profit per subscriber, order by order | Order | Subscribers still active | Profit so far | | --- | --- | --- | | 1 | 100.0% | $3.79 | | 2 | 85.0% | $13.72 | | 3 | 72.2% | $22.16 | | 4 | 61.4% | $29.33 | | 5 | 52.2% | $35.43 | | 6 | 44.4% | $40.61 | | 7 | 37.7% | $45.01 | | 8 | 32.1% | $48.76 | | 9 | 27.2% | $51.94 | | 10 | 23.2% | $54.65 | | 11 | 19.7% | $56.95 | | 12 | 16.7% | $58.90 | **Expected orders per subscriber** 5.72 **Order where profit turns positive** 1 **Order where it passes a one-time buyer** 3 First order / renewal $3.79 / $11.68. Over 12 orders $58.90 ## Your numbers **The subscription** List price $40.00 First-order discount 20% Renewal discount 10% Welcome gift unit cost, first order only $4.00 Product unit cost $12.00 Shipping charged $0.00 Subscribers who take the next order 85% Of subscribers who received an order, the share who receive the next. Orders to follow 12 **Fulfilment and payment** Pick and pack, per order $1.18 Each extra item picked $0.20 Box and packing, per parcel $0.50 Shipping label, per parcel $7.50 Card processing rate 2.9% Card fee per order $0.30 Refund reserve 5% The share of revenue you expect to refund. [Reset to the example](https://offersuite.io/calculators/subscription-first-order-vs-renewal) ## How it's calculated - First order: charge = list price × (1 − first-order discount); its costs include the welcome gift and its pick - Renewal: charge = list price × (1 − renewal discount); only the lines that recur ship again - Subscribers still active at order k = retention^(k − 1) - Expected profit per subscriber after n orders = first-order margin + Σ renewal margin × retention^(k − 1), for k = 2 … n Every figure on this page comes from Offer Suite's own margin engine, the same code the product uses to forecast each offer's and option's profit and to compute realized margin on orders. Money is computed in whole cents. ## Worked example A $40.00 bag of coffee on subscription: 20% off the first order ($32.00) with a mug in the box, then 10% off every renewal ($36.00). The first order keeps **$3.79** after the bag, the mug, the extra pick, shipping and fees. Each renewal keeps **$11.68**. A one-time buyer at full price keeps $15.36. If 85% of subscribers take each next order, a subscriber receives 5.72 orders on average over the first 12, and earns $58.90 in that time. They pass the one-time buyer at order 3. The welcome discount and the mug are paid back by the renewals; if retention is lower, it takes longer, which is why the table follows every order. ## Assumptions - Retention is the same at every renewal. Real subscriptions lose more subscribers after the first and second orders; a lower retention is the cautious reading. - The one-time buyer pays the list price with no gift and never orders again. If one-time buyers come back, compare against their repeat rate instead. - Profit is counted when each order ships, with no discounting for time. - Pick and pack $1.18 per order and $0.20 for each extra item are the defaults of the engine's DTC-US profile, a typical third-party warehouse contract. Use your own contract. - The shipping label ($7.50) is an assumption for a domestic ground parcel of about a pound. Your carrier account or shipping app has your rate. - Card processing of 2.9% + $0.30 is Shopify Payments' online rate for a standard card on the Basic plan in the United States. The Shopify Payments fees pages list every plan and country; enter yours. - The refund reserve (5%) is a share of revenue set aside for refunds. Cost is not reduced by a refund, because the goods were already picked and shipped. ## Questions ### Why is the first subscription order less profitable than a renewal? It usually carries a bigger discount and one-time costs: a welcome gift, an insert, a sample. A renewal is priced at the ongoing subscribe-and-save discount and ships only the products that recur. ### How many renewals does a subscriber need to beat a one-time buyer? Add up the first-order margin and each renewal's margin weighted by the share of subscribers still active, and see when that total passes the one-time margin. The calculator reports the order where it does, if it does within the orders you follow. ### What retention should I use? Your own, from your subscription app: of subscribers who received an order, how many received the next. If you only know churn per month on a monthly plan, retention is one minus that churn. ### Does this include customer acquisition cost? No. It is the margin the orders themselves earn. The subscription payback calculator puts your cost to acquire a subscriber against it, with churn. ## Embed this calculator Paste this where you want the calculator. It opens on the numbers above, recalculates as your readers change them, and links back to this page. **Show the embed code** ``` ``` ## See what your own offers earn. Offer Suite opens to Shopify brands a few at a time. Join the waitlist, or ask for a free profit audit of your past orders: realized profit per item and per offer option, what each costs you, and where margin leaks. [Join the waitlist](https://offersuite.io/waitlist) [Request a free profit audit](https://offersuite.io/profit-audit) ## Related - [Calculators **Profit calculators for Shopify offers** Calculators for contribution margin per order, break-even discounts, average order value, shipping by weight and zone, card fees, Amazon and TikTok Shop fees, break-even ROAS and CPA, upsell funnels, gifts, subscriptions, bundles and free-shipping thresholds, each run on Offer Suite's margin engine.](https://offersuite.io/calculators) - [Feature **Forecast and realized profit per offer option** Forecast and realized profit per offer, option, version, item and traffic source from one margin engine in whole cents, with ad spend, realized CAC and subscription LTV.](https://offersuite.io/features/profit) - [Calculator **Subscription payback calculator: CAC and churn** How much a subscriber's first order loses against what you paid to acquire them, how many renewals it takes to earn that back with churn, and in which month.](https://offersuite.io/calculators/subscription-payback) - [Calculator **Gift with purchase profit calculator** What a free gift costs per order, after its unit cost, its extra pick and its handling, and how much conversion it has to add to pay for itself.](https://offersuite.io/calculators/gift-with-purchase-profit) - [Calculator **Bundle pricing calculator: shipping, subscriptions** Price a bundle against a single unit, one-time and subscribed, with the shipping and pick costs it saves, and the conversion it can lose and still earn as much.](https://offersuite.io/calculators/bundle-pricing) - [Glossary **Refund reserve: definition, formula and example** A share of revenue set aside, in a forecast, for the refunds that will come. It turns an unknown future cost into a rate you can price an offer against.](https://offersuite.io/glossary/refund-reserve)