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Profitability (Mark Up Percentage (Cost of Good Sold (Cost of Supplier,…
Profitability
Mark Up Percentage
For every $1 of net sales, X cents represents gross profit for the business. Varies with businesses, needs to be high enough to make a good profit but not scare customers away.
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Gross Profit Percentage
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For every $1 of net sales, X cents represents gross profit for the business. The higher the better
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Expense Percentage
For every $1 of net sales, x cents represents administrative/ distribution/ finance expenses for the business. The lower the better, but remember the business needs to spend money to make money.
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Net Profit Percentage
For every $1 of net sales, X cents represents net profit for the business. The higher the better, as long as a profit is being made.
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