> ## Documentation Index
> Fetch the complete documentation index at: https://docs.upstackdata.com/llms.txt
> Use this file to discover all available pages before exploring further.

# New Customer CM2: First-Order Variable Margin

> Track New Customer CM2 for your Shopify store. Measure margin after fulfillment costs for first-time buyers.

<Tip>
  New Customer CM2 measures the variable margin from first-time buyers—CM1 minus fulfillment and transaction costs for new customer orders.
</Tip>

## Formula

<Info>
  **NC CM2** = **NC CM1** − **NC Fulfillment Costs** − **NC Transaction Costs**
</Info>

### Formula Components

| Metric                                                                                       | Definition                                |
| -------------------------------------------------------------------------------------------- | ----------------------------------------- |
| [**NC CM1**](/reference/metrics/orders/contribution-margin/new-customer-cm1)                 | New customer gross margin                 |
| [**NC Shipping Cost**](/reference/metrics/orders/fulfillment/new-customer-shipping-cost)     | Shipping costs for new customer orders    |
| [**NC Handling Cost**](/reference/metrics/orders/fulfillment/new-customer-handling-cost)     | Handling costs for new customer orders    |
| [**NC Gateway Cost**](/reference/metrics/orders/transaction/new-customer-gateway-cost)       | Payment processing fees for new customers |
| [**customer\_type = new\_customer**](/data-dictionary/measures-and-dimensions#customer-type) | Filters to first-time buyers              |

| Metadata        |                                                                      |
| --------------- | -------------------------------------------------------------------- |
| **Type**        | Currency                                                             |
| **Data Source** | [Shopify](/sources/shopify), [Upstack Costs](/sources/upstack-costs) |
| **Aggregation** | Sum                                                                  |

***

## Example

New customers generated **\$32,000** CM1 with **\$4,000** fulfillment and **\$2,000** transaction costs.

| Component      | Amount       | Calculation         |
| -------------- | ------------ | ------------------- |
| NC CM1         | \$32,000     | After COGS          |
| NC Fulfillment | \$4,000      | Shipping + handling |
| NC Transaction | \$2,000      | Gateway fees        |
| **NC CM2**     | **\$26,000** | \$32,000 − \$6,000  |

***

## How It Works

NC CM2 shows the contribution margin from new customers after all variable per-order costs. This is the margin available to cover acquisition costs and contribute to profit. If NC CM2 is lower than CAC, you're losing money on customer acquisition.

***

## When to Use

| Scenario                       | Action                                                    |
| ------------------------------ | --------------------------------------------------------- |
| Setting CAC limits             | NC CM2 should exceed CAC for profitable acquisition       |
| Comparing customer economics   | Benchmark NC CM2 vs RC CM2                                |
| Evaluating fulfillment options | See how shipping choices impact new customer margin       |
| First-order profitability      | Determine if first orders are profitable before marketing |

***

## Related Metrics

| Metric                                                                             | Relationship                             |
| ---------------------------------------------------------------------------------- | ---------------------------------------- |
| [NC CM2 %](/reference/metrics/orders/contribution-margin/new-customer-cm2-percent) | NC CM2 as a percentage of NC net revenue |
| [RC CM2](/reference/metrics/orders/contribution-margin/returning-customer-cm2)     | Variable margin from returning customers |
| [CAC](/reference/metrics/orders/performance/cac)                                   | Cost to acquire new customers            |

[See all Contribution Margin metrics →](/reference/metrics/orders/contribution-margin)