1. Ensure you have the Polar MCP installed (see Using Polar MCP).
2. Create a new Project in Claude.
3. In the Instructions box paste the instructions from below.
4. Update the USER INPUTS to specify if you want to include operating expenses etc.
5. To generate a report, start a new chat in the project with something like: “run the report”.
6. You can then:
   1. ask follow-up questions to go deeper
   2. tell Claude you want to amend the report
   3. customise the instructions yourself for future use

Instructions

Put these in a Claude Project “Instructions” fields.

USER INPUTS:
- Include Operating Expenses: {include_opex} [Y/N]
- Monthly Operating Expenses: ${opex_amount} [if Yes above]
- Target Net Margin: {target_margin}% 
- Analysis Period: {time_period} [default: last quarter + MTD]

PROMPT:
Generate a complete profitability analysis for {time_period} from gross margin to net profit.

**Margin Waterfall Analysis:**
Calculate and display progression:
1. Gross Sales (shopify_sales_main.raw.gross_sales)
2. Less: Returns & Discounts → Net Sales
3. Less: COGS (cost_of_products) → Gross Profit & Margin %
4. Less: Fulfillment costs → CM1 (contribution_margin_1_ratio)
5. Less: Marketing spend → CM2 (contribution_margin_2_ratio)
6. Less: Platform fees → CM3 (contribution_margin_3_ratio)
7. Less: All other variable costs → CM4 (contribution_margin_4_ratio)
{include_opex ? "8. Less: Operating expenses → Net Margin" : ""}

**Profitability by Dimension:**
- By Product/SKU (top 20 and bottom 20 by margin)
- By Category
- By Customer cohort (new vs returning)
- By Acquisition channel (which channels drive profitable customers)
- By Geography (if shipping costs vary)

**Marketing Efficiency Analysis:**
- POAS (poas) - Profit on Ad Spend
- Channels delivering profitable CAC vs requiring LTV breakeven
- Time to profitability by channel
- Impact of attribution model on profitability

**Discount Impact Analysis:**
- Total discount dollars (shopify_sales_main.raw.discounts)
- Discount rate by customer segment
- Correlation between discount % and customer LTV
- Optimal discount strategy for margin preservation

**Profitability Improvement Levers (to reach {target_margin}%):**

Priority 1 - Quick Wins (implement this week):
- Specific products to discontinue (negative margin)
- Shipping threshold adjustments
- Payment processing optimizations

Priority 2 - Medium-term (next 30 days):
- Pricing increases on inelastic products (list specific SKUs)
- Channel mix optimization (reduce spend on unprofitable channels)
- Operational efficiencies

Priority 3 - Strategic (next quarter):
- Product mix evolution
- Customer segment focus
- Market positioning changes

**Sensitivity Analysis:**
- Impact of 10% COGS reduction: +X% margin
- Impact of 10% marketing efficiency gain: +X% margin  
- Impact of 5% price increase: +X% margin
- Recommended focus area for maximum impact