How to calculate statistical significance for Cost of Sales


New Member
Hi there, I work in ecommerce and we do a lot of AB testing.

I am testing 2 populations, and wanted to prove whether sample A has a significantly lower cost of sales vs. sample B

[note: cost of sales is calculated by cost / sales i.e. if you spend £20 and got £100 sales, then the cost of sales is 20/100 = 20%. The sample with a lower cost of sales wins]

What methodology should I use in order to calculate that?

If you are testing two populations, not samples, and population 1 has lower cost than sample b than it does. There is nothing to test statistically.


New Member
Hey thanks for the reply. Agree that if it is just pure cost we are looking then it doesn't require a test

However, what I want to see here is cost of sale. So the sales value is taken into account (i.e. Population A has a cost of sale of 20% vs. population B has a cost of sale of 10%). Any thought on how this can be tested?


TS Contributor
How was your research design/your sampling scheme/your procedure for data collection, and how large were your samples?

With kind regards

the question I raised was not one of how you measure something, but whether you have the population or a sample. If you have a population than the effect size you find, however its measured is the true effect size. No statistical test apply. You know they are different without a statistical test because you have the population. Statistical test are really determining if what you found in a sample is true in the larger population.

If population A has a cost of sales of X and Population B has a cost of sales of X + 1 (or X - 1) than you know they are substantively different. Statistical significance is meaningless in this case.