Finance & Interest
Basic

Gross Margin

Percentage of revenue left after cost of goods.

Formula

GM=Revenue−COGSRevenue×100GM = \frac{Revenue - COGS}{Revenue}\times 100

Variables

COGSCost of goods sold

Example

Higher = more profit per sale

Did You Know?

Gross margin reveals how much of each sale survives after covering the direct cost of goods.

profitability