GFinance glossary

Gross Margin

Quick definition

Revenue remaining after the cost of goods sold.

Overview

Gross margin is the difference between sales revenue and the cost of goods sold (COGS), indicating how profitable a company's products or services are.

Common Uses

  • Profitability analysis
  • Performance assessment
  • Financial planning

Examples in Small Businesses

  • Monitoring cost variations
  • Calculating profit margins
  • Optimising selling prices
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