Gross Profit Margin %

Gross Profit Margin %

Gross Profit (Turnover less cost of sales) X 100

Turnover

 

Benchmark: 10%

Gross profit as a percentage of sales less VAT.

Gross profit is the profit generated from sales less costs of sales (stocks, warehousing, distribution and store costs) but before administration expenses.

The ratio gives a good indication of the retail margin before administration is accounted for.

Again, the benchmark figure will depend on the trading format.