Estimating net Revenue from steam game sales (minus Returns, Regional pricings, Discounts, VAT etc.)

Im doing some estimating/planning of net revenue of my game (game just in my head currently) - how much will my company receive after all other things/actors take their cut. The breakdown shows that from every copy of game sold, I (my company) willl receive ~ 46% from its selling price... Is this realistic? What is the number usually...?

The picture/table:
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https://prnt.sc/hiT-Q

My questions are:

1) Is the 46,41% my company receives from every copy sold realistic...? Whats this number usually like?

2) Are all the other numbers realistic...?
Returns & Chargebacks: 7,00%
Adjust for Regional Pricing: 15,00%
VAT (/Sales Tax in USA) - AVERAGE: 15,00%

3) Are the red arrows correct? Did i understand (and pictured) correctly the subtotals the % are taken from...? (for example Valves takes its 30% AFTER VAT is deducted ; Unreal Engine Takes its 5% (if gross revenue exceeds 1 mil USD) from BEFORE VAT is deducted...?) (BUT AFTER chargebacks and regional pricing) etc. correct?

Additional questions/"analysis":

I) Are the returns and chargebacks realistic at 7% only? (if my game is ok, good, no excess of bugs etc.)? Also WHY are chargebacks deducted and why are they often counted in separate category (i did NOT do it here)? Are majority of chargebacks atrributed to purchases made by stolen credit cards...? Or do some customers ABUSE the "return" policy and even if they played OVER steams 2 hours, they just get a "REFUND" by contacting their bank/credit card and asking for a chargeback ("illegal refund" essentialy)? (simply whats the reasoning behind chargebacks and sometimes counting them separately from refunds?)

II) Adjustments for regional pricing... Not sure i understand it correctly...
-If my game for example sells 100% of its copies ONLY in the USA, there would be NO need for "Adjustments of regional pricing" (0%) (since in USA it sells for its original full price)...? BUT (!):
-If i sell 100% of my copies in Russia (for example) for 5 USD (typical price adjustment for Russia AFAIK), the "Regional pricing adjustment" number would have to be at 50%...?
-AND If I will sell 50% of my copies in USA (full price 10 USD lets say), and 50% of my copies in Russia (for 5 USD), that would mean that the "Regional pricing adjustment" number would have to be at 25%, correct?

III) Regarding VAT... There is NO VAT in the USA... in the USA there is "Sales Tax", and is added ON TOP (in addition) of the original price of the game. And i dont really need to count anywhere in the table with it...?

-So if my game sells 100% of its coppies in the US, the "VAT" number in my table/chart shown would be 0% since i dont need to count with it in the table at all...?
-But if my game sells 100% of its copies in some other country (lets say Germany, whatever), that has VAT (and not sales tax), and the VAT in that country is 20% for example. This means 2 things - the VAT is now included in the price of the game (its not added on top of the game as in the case of "sales tax" in USA), and now in my calculations (table/chart) i would have to count with the VAT number at 20%... correct?
-AND If my game sells 50% copies in the USA and 50% copies in Germany, now i have to count with VAT at the average rate of 10% (0% USA, 20% Germany = 10 % VAT on average on every sold copy)... Correct?

I think developers (me included) do not fully understand the nuances in these numbers as shown, so i think if somebody can clarify/answer these, it would be MUCH HELP not just for me, but for a lot of other Devs as well...

Thank you

 

VAT always comes last, definitely after the store‘s cut. Steam pays VAT on their 30% and you pay VAT on the 70%.

Also there should not be any regional price adjustments but I may be wrong here. Are you sure this is what happens to Steam sellers?

For small businesses at least you would normally invoice Steam with the 70% and depending on where Steam is seated and where your company is seated you pay the VAT. For example if Steam is in Ireland (for EU customers) and you are within the EU then you don’t pay any VAT due to the reverse VAT charge system within the EU.

Anyhow, I would not go into this much detail. Beyond the 30% cut you cannot realistically assess any of these numbers. You are essentially using a looking glass to get some end result but what you really want to know is a ballpark number. But it cannot hurt to consider all of these aspects, mainly who deducts what when and why. I would totally ignore the currency adjustments and chargebacks, those are not going to make a big difference. On the other hand if you do want all of these details then you would have to consider tax deductions from expenses too, as well as the company’s liquidity over time ie expect payments to be delayed by two months and such things.

 

Hello
Im sorry, but where do you get your info? I really believe it is wrong (?)

1) Im pretty like 99,99% sure valve takes its cut AFTER the vat/sales tax was deducted... Also VAT always comes firsts AFAIK. If a game costs 10 USD, VAT is 20%, the revenue is left at 8 USD, valve takes its 30% from the 8 USD - 2,4 USD... (so realistically its 24% from the original price of the game).

I spent time just now re-looking at it once again...:

https://partner.steamgames.com/doc/finance/taxfaq#3
https://www.gamedeveloper.com/business/game-refunds-the-hidden-costs-of-getting-to-net-on-steam-2

where do you get the info that valve takes its cut from BEFORE vat is deducted? Even people online in other places said its after VAT.


2) Again, AFAIK you always have to take into account regional price adjustments, unless you sell all your copies in the USA (unrealistic) or you do not use regional pricing to begin with (also unrealistic AFAIK since people in affected countries wont buy the game for the full price)...

3) AFAIK steam pays VAT to each country FOR YOU, on your behalf, so you dont have to deal with it at all...?

(The "VAT and Sales Tax" section in link below):

https://partner.steamgames.com/doc/finance/taxfaq#3

"...Valve remits the tax collected on sales to the appropriate tax authorities."

"...Valve remits sales tax to the revenue authorities."

4) I think any developer needs to do some revenue/sales (and even cashflow) projections... Sure you do not know the future and your "guesstimates" can only be so close to reality, but still, im not aware of any big studios or profesionals who do not do this... (?) Companies have people dedicated just for this...

Thank you

 

why not contact valve?

 

Next to the above, probably consult an accountant.

 

I dont have any game yet as i wrote, im just doing some basic starter calculations, i doubt valve would respond to me.

 

yeah i will but later on, not just for the 1st "draft" of numbers .

 

So your answer for not confirming this with Valve is "eh, why bother?"

 

if you have a steam account, try contacting support. They've always been very helpful for me. Then you are getting answers straight from the horses mouth (what does that even mean?) I don't think they'll require you to have a game setup in order to answer questions about it.

 

Contact Valve/Steam or their forums. Closed.