Method · wk-of 03 Aug 2026

How do we know a profit window is real?

A plain-language read on the model behind Cratesmith — the four numbers on every chart, where US INFORM, EU GPSR and DAC7 paperwork load feed the shortlist, and what the score will not do for you. Written for sellers who just read the sample brief and want to know how the call is made.

What this page is — and isn't

  • ·For sellers who just read the sample weekly brief.
  • ·Plain language, no research-paper jargon.
  • ·Aimed at the four numbers, the three compliance lenses, and the four workflow passes — not at every input the model touches.
  • ·Not a buying recommendation. The score says a window is open; your operator decides whether to walk through it.

What the score actually measures

How long the margin lasts — before the copycats arrive.

Every shortlisted SKU carries the same four numbers. The first-week GM is the high mark; the half-life is the window to commit inventory; the stable GM is the long-run margin you can still build a business on; the imitator-entry week is when the countdown starts. The chart below is a worked example at the median slot Cratesmith curates.

Cross-link back to the sample brief to see the same chart attached to a single SKU: read the brief →

24-week forecast

illustrative · median slot

imitators enter · wk 10margin half-life · wk 14≈ 47% GMstable band · 31% GM0%25%50%75%100%gross marginwk 1wk 6wk 12wk 18wk 24

The four numbers on every chart

Same four numbers, every shortlist row.

The brief is dense on purpose — every row answers the same four questions in the same order, so a seller can scan the table without re-learning the column heads each week.

First-week GM
63%

Gross margin on the first week of trading — the high mark before copycats arrive.

Half-life
~14weeks

How long until that first-week margin has roughly halved. The window to commit inventory.

Stable GM
31%

The long-run margin you can still make a healthy business on once the slot is crowded.

Imitator entry
wk 10

The week copycats typically begin undercutting you — the start of the half-life countdown.

How the three compliance lenses feed the score

The paperwork is part of the model, not an afterthought.

Every shortlisted SKU has been screened against the three lenses that govern e-commerce sellers in 2026: US INFORM, EU GPSR and DAC7. A SKU that fails any lens never reaches the shortlist — the stable-GM figure you see on the chart already accounts for the duty and compliance overhead those lenses impose.

United States

US INFORM Act

Cleared with conditions

The US INFORM Act (signed 2022, enforced by the Consumer Product Safety Commission) requires a responsible party in the US to keep traceability records on consumer products and to file a safety report within 24 hours of a qualifying incident.

Every Cratesmith candidate is screened against the consumer-product categories the Act lists — children's items, electronics with a battery, anything that ships with a chemical or mechanical hazard — and the relevant CPSIA, Prop 65 and FCC obligations are added to the SKU's to-do list.

  • A US-based responsible party is named before the SKU ships (you, the manufacturer, or an authorised rep).
  • A safety report is filed with the CPSC for any qualifying incident within the 24-hour window.
  • Tracking label + permanent batch mark on the unit and the outer carton.
  • A Children's Product Certificate (CPC) on file where CPSIA applies.
  • CA Prop 65 warning + chemistry screen for any candidate that ships into California.

European Union

EU GPSR

Cleared with conditions

The General Product Safety Regulation replaced the old GPSD in December 2024. Every consumer product placed on the EU market must have a responsible person physically based in the EU, a traceability mark on the product and packaging, and a Declaration of Conformity retained for ten years.

For our candidates, the GPSR lens pulls in any CE-marking obligation, REACH SVHC screens for chemistry-heavy SKUs, and EU food-contact labelling (1935/2004) where the product touches food.

  • A responsible person physically based in the EU is named before any unit ships.
  • Traceability mark on the unit + outer carton, plus product-passport-style labelling where the category requires it.
  • CE marking + Declaration of Conformity retained for 10 years after the last unit is placed on the EU market.
  • REACH SVHC + POPs screens on chemistry-heavy SKUs.
  • EU 1935/2004 food-contact labelling where the product touches food.

Cross-platform

DAC7

Platform-handled

DAC7 is the EU's directive on marketplace seller reporting: from 2023, every digital marketplace that operates in the EU has to collect sellers' tax IDs and report their activity to the tax authority. The seller does not file directly — the platform does — but the seller has to hand the data over.

We treat DAC7 as a platform-handled check: the work happens at the marketplace level, not on the seller's desk. The brief tells you what data each platform expects so your ops team is not chasing it on listing day.

  • Each seller's tax ID (TIN) is on file — the marketplace then reports it to the EU tax authority on the seller's behalf.
  • US marketplaces (Amazon, Walmart) handle the US-side equivalent themselves — no extra seller work.
  • Cratesmith surfaces the SKU-level data the platform needs in its quarterly report.

The full workflow

Four passes, ranked — never an infinite index.

A wider list is not a useful list. Each pass feeds the model; the shortlist is the model's output. Read top-down for the order they happen in, or scan the right column to see which numbers each pass writes onto the chart.

  1. step 01

    Sweep the demand surface

    feeds · First-week GM anchor

    Bestseller movement, search spikes and TikTok Shop surges across Amazon, Walmart Marketplace, Temu and Shopify. The candidate's first-week gross margin is anchored to the price the week's demand actually clears at, not the listed MSRP.

  2. step 02

    Layer in supply pressure

    feeds · Half-life + imitator entry

    For every candidate we plot how fast the slot will be priced down — seller density, brand-trademark activity, review velocity, inventory overhang. The output is a half-life in weeks plus the week copycats typically enter, both written onto the chart.

  3. step 03

    Run compliance + landed-cost checks

    feeds · Compliance badge + stable GM

    US INFORM, EU GPSR, DAC7 paperwork load; de-minimis import-cost simulation after the Section 321 reform; tariff exposure; small-lot logistics. A SKU that has not cleared every applicable check never makes the shortlist — and the stable-GM figure already accounts for the duty and compliance overhead.

  4. step 04

    Issue a curated shortlist

    feeds · All four numbers

    A weekly digest — five to seven durable bets, each carrying the four numbers (first-week GM, half-life, stable GM, imitator entry week), the compliance badge, a landed-cost memo and a positioning angle. The list is the method's output, not a reformat of someone else's bestseller index.

What the score is NOT

Limits, stated plainly.

A score is only useful when you also know what it ignores. Three things the Cratesmith number deliberately will not do for you.

  • Not a sentiment score

    We are not tracking how loud a category is on social. The decay number is anchored to seller density, ASP ladders and actual review velocity — the boring inputs that decide whether you can still make money at month six.

  • Not a buying recommendation

    Cratesmith is a curated input, not a buying decision. We surface what clears the model; you decide what fits your lane, your cash and your operator. The walk-away list is part of the brief for the same reason.

  • Not a managed-research substitute

    The weekly digest is the whole product. We are not a research desk you can call. If you need bespoke category work, this is the wrong tool for that job.

Next issue · Mon 06:00

Five to seven of these, every Monday morning.

You just read the methodology. The real shortlist arrives each Monday with every row plotted against this model — and the list of products we'd walk away from.

cratesmith-4@polsia.app

Or wire your ops team's Slack — we'll deliver the weekly digest there.