Definition
Gross profit margin is the ratio of gross profit to revenue, expressed as a percentage. It shows the percentage of revenue that exceeds the cost of goods sold.
Related Services
Cost management, financial reporting, and pricing strategy services help businesses improve gross profit margin by managing costs and optimizing pricing.
Problem and Application
A low gross profit margin can indicate inefficient production processes or pricing strategies that may need adjustment.
Conclusion
Gross profit margin is a key performance indicator for businesses, reflecting operational efficiency and pricing strategies that drive profitability.
