Definition
Gross margin is the difference between revenue and the cost of goods sold (COGS), expressed as a percentage of revenue. It indicates how efficiently a company produces its goods.
Related Services
Cost management, financial analysis, and performance benchmarking services help companies optimize their gross margin by managing COGS and improving efficiency.
Problem and Application
Gross margin can be influenced by pricing strategies, production costs, and operational efficiency, so businesses need to continuously monitor it for improvements.
Conclusion
A high gross margin is a key indicator of financial health and operational efficiency, and it plays a critical role in pricing and profitability strategies.
