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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.
